Tenure

We will lend on:

  • Freehold - houses and bungalows
  • Leasehold (including good leasehold title)
  • Commonhold
  • Ownership (Scotland)
  • Flying Freehold (subject to confirmation from the valuer that the property is suitable security)

Minimum Leasehold Terms

Please also see New Build Property Lease Terms below

England and Wales

Flats and Houses - a minimum unexpired lease of 55 years is required at application with a minimum unexpired lease term of 30 years after mortgage term ends.

Where a new longer lease or lease extension is to be purchased the application will be  processed using the details of the new/extended lease.

Northern Ireland

Flats and Houses - a minimum unexpired lease term of 50 years after mortgage term ends.

Scotland

Flats - a minimum unexpired lease term of 50 years after mortgage term ends.

Houses - refer to your usual Service Centre.

Valuation criteria

The valuer must be satisfied that there is a market for any property taking the lease term into consideration. Therefore, even though an application may meet the guidelines above, the property may still be declined by the valuer.

For example, a mortgage application in England for a 20 year term with a 56 year unexpired lease is within policy, but the valuer may advise the property is not readily marketable and saleable and will not consider the property as suitable security.

New Build Property Lease Terms*

  • Minimum acceptable lease term on new build properties (including office conversions) is 125 years for flats and 250 years for houses.
  • Maximum starting ground rent on all new build properties with a leasehold tenure is limited to 0.1% of the property value.
  • Ground rent must be reasonable at all times during the lease term. For example, ground rent escalation should be linked to RPI (Retail Price Index) or a similar index, and unreasonable multipliers of ground rent will not be permitted, for example doubling every 5, 10 or 15 years.

*Does not apply to Shared Ownership applications