Minimum Unexpired Lease Terms : From the Fire to the Furnace

Leasehold conveyancing solicitors beware : Lenders are changing their minimum lease term requirements.

For the second time in the space of a week a CML  lender discarded  a whole slice of the leasehold market from being mortgageable for their perspective.  

Furness Building Society is the latest lender to  tighten  their minimum lease term requirements. This recent change is particularly impactful as the lenders has set a minimum lease term of 85 years. This is the first CML lender to set such a requirement. Those attending the recent LENDERmonitor webinar on ‘CML Handbook Trends and Predictions for 2015’ will not be shocked but this will come as a surprise to many conveyancing lawyers who will be hoping that other lenders do not follow suit.

Furness  used to accept leases where there was a minimum 55 years unexpired from completion, subject to not less than 30 years remaining at the end of the mortgage term. As of today they now require 85 years unexpired from completion, subject to not less than 55 years remaining at the end of the mortgage term.

Furness Building Society conveyancing panel lawyers should take note. On the upside there may be a possibility for picking up lease extension work.

Metro Bank Conveyancing Panel - New Part 2 Requirements

Conveyancing solicitors on the Metro Bank Conveyancing Panel can, as from today, carry out personal local authority searches as opposed to being required to carry out official searches.

By way of a change to the banks's CML Handbook Part Two requirements the answer to section 5.4.5 (Does the lender accept personal searches and, if yes,what are the lender's requirements?) now reads :

'Yes- We recommend that any firm carrying out a personal search is registered under The Search Code monitored by the Property Codes Compliance Board..'

Other lenders have made a similar recent changes to the CML Handbook Part 2 section.

The Search Code provides protection for homebuyers, sellers, estate agents, conveyancers and mortgage lenders who rely on the information included in property search reports undertaken by subscribers on residential and commercial property within the United Kingdom. The Code is now recognised by many mortgage lenders that make specific reference to it in their Part 2s of the CML Handbook.

Lexsure data reveals that the conveyancing solicitors in London are more likely to carry out personal searches.

Platform Home Loans Conveyancing Panel Alert - Minimum Lease Term

Mortgage companies continued the trend to shy away from properties with short leases with Platform Home Loans yesterday tightening their minimum lease term requirements.

The lender used to accept leases where there were 50 years unexpired at application and 25 years at the end of the mortgage term.. As of today they now require a minimum unexpired lease term of  70 years at application with 30 years remaining at the end of the mortgage term.

Platform Home Loans conveyancing panel lawyers should take note. On the upside there may be a possibility for picking up lease extension work.  The change brings the lender in line with Britannia and the Co-operative Bank.