For firms on the Santander Conveyancing Panel, staying aligned with the lender’s evolving criteria is essential to ensuring smooth completions and avoiding post-offer delays. Santander has recently updated Part 2 of the Lenders’ Handbook, specifically under Section 5.14.9, introducing new benchmarks for acceptable ground rent provisions.
As leasehold reform continues to be a focal point for both regulators and homeowners, these changes reflect a push toward greater affordability and long-term sustainability for leaseholders.
The New Criteria for Section 5.14.9
All ground rents must comply with relevant legislation.
Ground rents for purchase, or for re-mortgage transactions are acceptable where all of the following apply:• Ground rent less than or equal to 0.1% of the property value and
• Ground rent review period greater than or equal to 10 years and
• Ground rent increase less than or equal to RPI.
Where the ground rent exceeds 0.1% of the property value, refer to Mortgage Operations office instructing you.
Ground rent provisions involving review periods of less than 10 years or increases above RPI are unacceptable and amendment of the lease by a deed of variation is required.
For the latest wording please check the The UK Finance lenders’ handbook. Note that Santander and other lenders can and do change their P2s at any time.