Ground Rent · Report on Title scenarios
Ground rent
5 situations in which ground rent comes up during a conveyancing transaction, each answering a different question.
- My ground rent doubles every 25 years — does that matter?The lease doubles the ground rent at fixed intervals. What that does to lending and value, what your lender has to say about it, and the two routes to getting the clause changed.
- My ground rent is over £250 — why does that matter?A ground rent at or above £250 outside London brings a long lease within the Housing Act 1988. What that does to forfeiture, why lenders care, and what can be done before exchange.
- The lender wants indemnity insurance for the ground rent — what does it cover?Where the landlord will not vary a lease whose ground rent crosses the statutory threshold, the lender may accept a mortgagee-only indemnity policy. What it covers, and what it does not.
- My ground rent rises with RPI — what will it become?The ground rent is reviewed by a formula such as RPI rather than a fixed multiplier. Why that is harder to price than a doubling clause, and what it does to a future lease extension.
- Nobody has collected the ground rent — does it still have to be paid?The lease reserves a ground rent but nobody collects it, often where the residents own the freehold. Why that is a technical breach, what the real risk is, and what it means on a sale.
Already bought, and ground rent has become a problem?
These pages are written for someone still deciding. If this came up after you completed, the question is a different one — what was known during the purchase, and what should have been reported to you.
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