Buying a leasehold property at a glance
Before committing to a leasehold property, you should understand:
- How many years remain on the lease
- How much ground rent you will pay and whether it can increase
- The current service charge and what it covers
- Whether major building work is planned
- Whether there is a reserve or sinking fund
- Whether the building has any cladding or fire safety concerns
- Whether the lease restricts pets, alterations, letting or business use
- Whether the property and lease meet your intended mortgage lender’s requirements
Your solicitor will examine the lease and advise you on its legal terms. Your mortgage broker can consider how those terms and the type of property may affect your mortgage options.
What does leasehold mean?
When you buy a leasehold property, you own the property for the number of years stated in the lease. The freeholder normally owns the building or the land on which it stands.
Most leasehold properties are flats, although some houses and Shared Ownership homes are also leasehold.
The lease is a legal agreement setting out your rights and responsibilities. It may explain:
- How long you own the property
- Which parts of the building belong to you
- What you must contribute towards maintenance
- Whether you must pay ground rent
- Who insures and maintains the building
- What changes you can make to the property
- Whether there are restrictions on how you use it
Your solicitor should explain the legal terms to you before you exchange contracts.
Can you get a mortgage on a leasehold property?
Yes, mortgages are commonly available on leasehold properties. However, the property and lease must meet the lender’s requirements.
Different lenders can take different approaches to:
- The number of years remaining on the lease
- Ground rent and how it increases
- Service charges
- Flats above or close to commercial premises
- High rise buildings
- Former local authority properties
- Building safety and cladding
- Unusual lease terms
- Restrictions affecting the use or future sale of the property
This means that being able to afford the mortgage does not automatically mean every lender will accept the property.
A broker can help you avoid applying to a lender whose property requirements are unlikely to fit the home you are buying.
A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
Why does the remaining lease length matter?
The lease becomes shorter as time passes. A short remaining lease can affect:
- Whether a lender will offer you a mortgage
- The number of lenders available to you
- The property’s value
- How easy it may be to sell
- The possible cost of extending the lease
There is no single lease length accepted by every mortgage lender. Some lenders require a minimum number of years remaining when you buy, while others also consider how many years will remain at the end of the mortgage term.
Do not assume that a property is suitable for a mortgage simply because the seller currently has one. The seller’s mortgage may have been arranged under different criteria or when the lease was longer.
Ask the estate agent how many years remain on the lease as early as possible. Your solicitor should verify the exact lease term, but an early indication can help your broker assess which lenders may be suitable.
What should you check about ground rent?
Ground rent is separate from the service charge. It may be payable to the freeholder under the terms of the lease.
You need to know:
- The current annual ground rent
- How often it is reviewed
- How it is calculated
- Whether it increases during the lease
- How much it could become in the future
Some older leases contain ground rent clauses that allow the charge to increase significantly over time. This can affect the property’s affordability, mortgageability and future saleability.
Most new leases granted from 30 June 2022 do not normally charge more than a nominal ground rent. However, this does not automatically remove ground rent from an older lease when the property is sold to a new owner.
Your solicitor must review the ground rent clause and advise you on its legal effect. Your Mortgage Adviser can then consider whether the terms are likely to be acceptable to the lenders available to you.
How much is the service charge?
The service charge is normally your contribution towards maintaining, managing and insuring the building and its shared areas.
It may cover:
- Buildings insurance
- Cleaning and lighting shared areas
- Repairs and maintenance
- Gardens and outside spaces
- Lifts
- Managing agent fees
- Concierge or security services
- Contributions to a reserve or sinking fund
The service charge can affect your overall affordability. A mortgage payment that appears manageable may feel very different once the monthly or annual service charge is included.
Mortgage lenders may also take ongoing service charges into account when assessing what you can afford.
Ask to see:
- The current service charge
- Recent service charge accounts
- The budget for the coming year
- Details of any recent increases
- Whether any payments are overdue
- What is included in the charge
Your solicitor should examine the formal information supplied by the seller, freeholder or managing agent.
Are there restrictions in the lease?
The lease may restrict what you can do with the property.
Restrictions can relate to:
- Keeping pets
- Letting the property
- Short term or holiday letting
- Running a business from home
- Installing hard flooring
- Making structural alterations
- Replacing windows
- Extending into a loft
- Parking
- Using shared areas
These restrictions matter even if they do not affect your immediate mortgage application.
For example, a restriction on letting could be important if you might want to rent the property out in the future. A restriction on alterations could affect renovation plans.
Tell your solicitor how you intend to use the property so that they can check whether the lease allows it.
How can a mortgage broker help when you are buying leasehold?
The mortgage lender and your solicitor have different roles.
Your solicitor advises you on the lease, legal title and contractual obligations. A mortgage broker helps you understand your mortgage options and how a lender may view the property.
At Your Mortgage Expert, we can help you:
- Understand how much you may be able to borrow
- Include service charges and other commitments in your affordability planning
- Check lender requirements relating to the remaining lease term
- Consider how ground rent terms may affect lender choice
- Identify lenders that may accept the type of flat or building
- Check the likely requirements for high rise or unusual properties
- Liaise with you throughout the mortgage application
- Work alongside your solicitor when the lender raises property questions
- Help you avoid applying to an unsuitable lender
It is much better to identify a potential mortgage issue before submitting an application than after you have paid valuation, survey or legal fees.
When should you speak to a mortgage broker?
You should ideally speak to a mortgage broker before making an offer.
You may not have all the leasehold information at this stage, but useful questions to ask the estate agent include:
- How many years remain on the lease?
- What is the annual service charge?
- What is the ground rent?
- Does the ground rent increase?
- Are any major works planned?
- Is there a reserve or sinking fund?
- Are there any cladding or fire safety issues?
- Is the property above or close to commercial premises?
- Is it a former local authority property?
- Are there restrictions on pets, letting or alterations?
Once you have these details, we can consider the likely mortgage position and help you decide on the next step.
Get mortgage advice before you commit
A leasehold property can be a perfectly suitable home, but the details of the lease and building matter.
Do not wait until the lender’s valuation or your solicitor’s report to discover that the property may be difficult to mortgage.
Tell us about the property, your deposit, income and circumstances. We can help you understand your likely options, identify suitable lenders and prepare your mortgage application.
We provide mortgage advice throughout the UK by phone and video call, with face to face appointments also available near Salisbury.
Ask Us About a Leasehold Mortgage
Last reviewed: June 2026
This article provides general information and is not legal advice. You should ask a qualified solicitor or licensed conveyancer to review the lease and advise you before exchanging contracts.