I have an expensive property in Central London and need to raise funds quickly, how do I get Finance for Lease Extensions?
I recently have received a number of enquiries within the Knightsbridge, Mayfair, Chelsea and Kensington areas which are notoriously known for containing very expensive properties but unfortunately with short leases. Getting finance for short Leases and lease extensions appears to be a major issue in and around Central London as traditional mortgage lenders tend to insist on a minimum lease period of 50 years after the mortgage term has expired before they will lend.
The good news this if you’re reading this article then the chances are that you are an owner of one of those properties, first of all may I congratulate you on a successful investment strategy as many of the properties within those areas have seen an increase of up to 50% value appreciation, even during these tough times. This is mainly caused by the influx of wealthy overseas investors who have the money and nouse to steal in on these opportunities.
The main issue that surfaces is the length of lease which is often shorter than twenty years. Extensions are availably but costly. Many astute property developers have got very good long-standing commercial arrangements with lenders but this also means that the lenders have taken charges on their property so refinancing a couple of million pounds worth of properties does not represent a good option when you’re playing 3% interest rate.
Securing a second charge short-term finance across the equity in the portfolio could be the answer if the intention is for on-ward sell once the lease has been extended. Alternatively, you may look at a particular property within the portfolio, and refinance that in isolation, so the majority of properties remain on good rates.
A Niche we help you get Finance for Lease Extensions or home conversions and have a proven track record in this sector being based at the heart of London in Victoria.
If you are a professional landlords beneath access to Finance for Lease Extensions please contact us on (020) 7993 2044 or alternatively complete the enquiry form on the right-hand side of this page.
Payam Azadi is a partner at Niche Advice Ltd who are Independent Financial and Mortgage Advisers in London.
Author: Payam Azadi
Payam Azadi is a partner at Niche Advice who are whole of the market Independent Mortgage Brokers. His role is very much focused on Property financing both on residential and commercial lines.