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Mortgages for Leasehold Houses

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Mortgages for Leasehold Houses

    • 4.07% Initial
    • 5 year fixed
    • 6.6% APRC
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    • 4.10% Initial
    • 5 year fixed
    • 6% APRC
    • Cashback £0
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    • 4.14% Initial
    • 5 year fixed
    • 6.3% APRC
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    • 4.17% Initial
    • 5 year fixed
    • 6.4% APRC
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    • 4.17% Initial
    • 2 year fixed
    • 6.7% APRC
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    • 4.18% Initial
    • 5 year fixed
    • 6.7% APRC
    • Cashback Max £250
      Free Legals
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    • 4.18% Initial
    • 5 year fixed
    • 6.7% APRC
    • Cashback Max £250
      Free Legals
      Free Valuation
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    • 4.19% Initial
    • 5 year fixed
    • 6% APRC
    • Cashback Max £1,250
      Free Legals
      Free Valuation
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    • 4.19% Initial
    • 2 year fixed
    • 8% APRC
    • Cashback £0
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    • 4.20% Initial
    • 5 year fixed
    • 6% APRC
    • Cashback £0
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Representative example based on a fixed rate mortgage

A mortgage of £375,000 payable over 20 years initially on a fixed rate for 5 years at 4.38% and then at the standard variable rate of 7.65% for the remaining 15 years would require 60 monthly payments of £2,351.88 and then 180 monthly payments of £2,899.55.

The total amount payable would be £663,156.80 which includes interest and product fees of £1,124.

The overall cost for comparison is 6.5% APRC representative.

Early repayment charges may apply.

Mortgages for Leasehold Houses

Mortgages for leasehold properties: how to get the best deal

Unlike flats or apartments, most houses are sold freehold - meaning you own the building and the land on which it stands. Some houses, such as those under shared ownership schemes, are always leasehold.

Having a leasehold house means that you can live in it until the lease expires, but you don't own the land. Because many conventional lenders do not know leasehold mortgages for homes, you may have difficulty obtaining a mortgage deal if you want to purchase a leasehold house.

How do leasehold and freehold houses differ?

A property listing will indicate whether you are buying a leasehold or freehold property.  If you buy a freehold house, you own both the building and the land it is built on, as well as any land included in the freehold, such as a private garden. You can either sell the property to a new buyer or leave it to another person as part of your estate. Freehold houses have the following features:

  • There is no ground rent to pay each year

  • There are no maintenance charges or freeholder responsibilities

  • There are no issues with the lease expiring

  • Following planning regulations, you can renovate the building as you wish 

By contrast, when you purchase a leasehold house, you essentially buy the right to use the property for the remaining term. It is usually quite high - often exceeding 100 years.

If you buy a leasehold property with plenty of time left, you can occupy it for several decades after the purchase. Leasehold houses have the following features:

  • Annual maintenance fees or service charges

    Ground rent must be paid annually

    Any major changes to the property require permission from the freeholder

    Is it possible to get a mortgage for a leasehold house?

Some leasehold houses are easier to get a mortgage for than others. For instance, houses purchased under a shared ownership scheme may be more accessible to purchase this way. Housing associations sometimes offer shared ownership schemes, in which you buy a share and pay rent on the remaining share.

 

To investigate your leasehold finance options, call our broker team or fill in our call back form -  speak to our independent mortgage broker team who will be able to offer impartial advice or you can call us on 0117 403 3464

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