Lease Extension

Image of the new Platform properteis at Trentside, Beeston

On 21st July 2020 the Law Commission published proposals to change the lease extension and enfranchisement process.  Whilst this does not take effect yet and we have no information as to how these proposals will be implemented or law changed, we recommend that you review the Law Commission page before proceeding with any application.  If you’d like to discuss the proposals or the current legislation and Platform’s approach, please do contact us.

As your lease term decreases, there are associated negative implications that you should be aware of.  This can include difficulties in selling or re-mortgaging as well as the decreasing value of the property itself.

However, as a leaseholder or shared owner, you may have the opportunity to add a further 90 years to the existing term of your lease. This is known as a lease extension. A premium will be payable to Platform to do this.

The potential benefits of extending your lease now include the following:

  • Easier to re-mortgage – mortgage lenders are more willing to lend on longer lease terms.  Where there are less than 80 years remaining, it may be deemed that there is inadequate security for the loan.
  • Easier to sell – a short lease is likely to make the property less attractive to potential buyers
  • The value of your home is protected – the value of the property would fall when the remaining lease term is low as the asset is diminished
  • Premium payable will increase over time – the increase in the premium is two-fold:
  • In general terms, the greater number of years left on the lease, the cheaper the amount payable to extend it
  • If house prices rise in the future, the premium rate would subsequently increase as well

 

A lease extension application can be made through the statutory route or the  voluntary route (depending on the circumstances).  The difference between the two is:

Front view

Statutory Lease Extensions

You must be both a 100 per cent leaseholder and have owned the property for at least two years.  If you are a shared owner you can’t have a statutory lease extension and will need to go down the Voluntary Lease Extension route.

Voluntary Lease Extensions

You can be either a 100 per cent leaseholder who has owned the property for less than two years or a shared owner.

Front exterior
Man in a white shirt making a phone call

Contact Us

You can get more information on lease extensions and apply for a voluntary or statutory lease extension by emailing info@platformhg.com or phoning our Customer Hub on 0333 200 7304.

 

Contact us

Independent Legal Advice

If you would like some independent legal advice you can get this from the Citizens Advice Bureau, a housing advice centre or a firm of solicitors. The Leasehold Advisory Service (LEASE) can also provide advice.  LEASE is an independent, government back organisation that provides information and advice on leasehold matters.