The freehold DIP cleared in a morning. The leasehold twin lands with a sixty-two year term, a doubling ground rent and a service charge schedule that stops two years ago. Credit does not reprice the LTV first. They ask for the lease PDF. Until that zip arrives, the bridging loan sits on the desk.

StatusKWO underwrites short commercial facilities for professional investors, developers and SPVs. Owner-occupier main-home work sits elsewhere. The published schedule currently shows a monthly rate from 1.25%, an entry fee of 2%, an exit fee of 1.5%, LTV up to 85%, loans from £10,000 to £10,000,000+ and terms up to 16 months. Those numbers are schedule figures. They do not rewrite a short lease or an arrears notice that blocks chargeability.

The leasehold file that stalls after the freehold DIP looked fine

A tidy decision in principle on a freehold terrace does not transfer to a flat with a short unexpired term. Tenure changes the security story. Brokers who paste the same covering email for both assets force a second round of questions that should have been page one.

Our general bridging pack note covers identity, companies and exits. This week’s auction memorandum pack covers post-hammer papers. The page you are reading is narrower. It is the leasehold evidence a specialist desk wants before it prices remaining term, ground rent, service charge and consent-to-charge risk on an unregulated commercial bridge.

Start the enquiry with one page. Address and title number. Freehold or leasehold. Unexpired term in years. Ground rent amount and review pattern. Current service charge and any arrears. Named freeholder or managing agent. Consent-to-charge clause yes or no. Gross and net loan. Term. Use of funds. Named exit. Borrower and guarantor names. Then attach the lease. Credit can read a brochure in five minutes. They cannot invent a doubling clause from a line that says “long leasehold”.

GOV.UK’s How to lease guide is blunt for buyers. The lease sets ground rent and service charge. The conveyancer should send a copy and summarise landlord and leaseholder duties. Specialist credit takes the same view even though the product is commercial bridging rather than a consumer purchase. The lease is the contract. A summary email is not a substitute.

Remaining term that a term lender will not take out

Bridges die on exits more often than on purchase LTV. A refinance take-out that needs eighty-plus years remaining will not clear a lease that shows sixty-eight today and sixty-seven at the end of a twelve-month facility. Say the remaining term on page one. Do not hide it in a solicitor footnote on day nine.

Credit reads the term against the named exit. Sale exits care about buyer finance. Refi exits care about term-lender criteria. Auction clocks care about both when the lot is leasehold and the buyer still needs a take-out after works. Our sale-exit evidence note covers diaries and Plan B. The lease term still has to survive that diary.

Short leases are not an automatic decline on every commercial file. They are a structure problem. Simultaneous extension. Cash equity. Cross-charge over another freehold. A shorter bridge that clears before the term lender’s floor. Put the plan in writing before the valuation instruction. A covering line that “extension is in hand” without a solicitor letter and a costed premium is hope, not evidence.

Match the term to the Land Registry position. Order official copies of the register, plan and filed lease early. HM Land Registry’s finding information guidance explains how buyers obtain register, plan and document copies when “copy filed” appears. Credit still wants those papers in the zip. A portal screenshot that crops the term and omits the lease PDF fails.

Leasehold flats inside a larger block can sit on a headlease and an underlease. Draw the chain. Name which title is being charged. Two titles behind one brochure photograph create legal delay that a sixteen-month bridge does not absorb gracefully. Portfolio finance files with mixed freehold and leasehold stock need each tenure marked on the schedule. Averaging terms across a book hides the weak unit that kills the refinance.

Lease PDF ground rent and escalation credit must read

Ground rent belongs in the first pack with the amount, the payment dates and the review pattern. Fixed. Stepped. Linked to RPI. Doubling every ten or twenty years. Capital-value linked. Credit prices the security. They also need to know whether a future rent makes the lease harder to sell or refinance.

GOV.UK’s buying or owning a leasehold home page sets out the basics. Ground rent is usually annual. The lease should say how much and whether it will increase. Service charges cover building services and can include buildings insurance. Demands have formal rules. Specialist desks still want the lease wording and the latest demands, not a verbal “peppercorn” that turns out to be £450 escalating.

New long residential leases granted from 30 June 2022 are a different story under the Leasehold Reform (Ground Rent) Act 2022. For most regulated new leases the permitted rent is a peppercorn. Existing leases keep their contractual ground rent. Do not treat every flat as peppercorn because the Act exists. Put the grant date and the rent clause on page one so credit can see which regime applies.

Onerous escalation is the stall that brokers under-price. Doubling clauses that bite inside the bridge term or soon after a refinance date scare take-out lenders. Rents that can climb toward a level that muddies assured-shorthold treatment create legal noise. If the lease has a problem clause, say so and attach the indemnity or deed-of-variation plan. Silence until the lender’s solicitor raises it wastes a week of an auction finance clock.

Attach the latest ground rent demand and proof of payment where arrears are nil. Arrears need a figure and a clearance plan. Freeholders can pursue unpaid rent. Credit will not ignore a notice that sits behind the charge. If the seller is clearing arrears on completion, put that in the special conditions or completion statement and show the cash source. Our source-of-funds pack covers deposit trails. Arrears clearance cash sits in the same zip when the borrower is funding it.

Service charge arrears management packs and major works

Service charge kills more leasehold bridges than brokers admit. The lease lists what can be charged. The management pack shows what is actually demanded. Major works notices and Section 20 consultation papers change cash and value. A quiet covering email that says “service charge up to date” without statements is not enough.

Send three years of service charge accounts or demands where they exist. Show the current year budget. Flag any reserve fund position. If a major works programme is live or threatened, attach the notice and the estimated contribution. A refinance exit that assumes yesterday’s service charge will fail when a roof project lands mid-bridge.

Arrears need the same honesty as ground rent. Put the balance next to the loan amount. If the buyer must clear seller arrears on completion, model the cash. Bridging can fund purchase price against security. It does not invent cash for historic service charge the borrower forgot to add to the completion waterfall.

Buildings insurance sits inside many service charge regimes. Credit still wants confirmation that cover exists and that the lender can be noted. A management company that collects insurance through the service charge is fine when the pack shows it. A gap with no policy and no landlord confirmation is a funding risk. Say who holds the policy and when it renews.

Shared freehold or resident-management companies add another layer. Name the company. Attach Companies House extracts if the borrower or SPV sits on the board. Our SPV and Companies House pack covers entity papers. Management company membership does not replace them. It sits beside them when control of the block matters to the security story.

HMO or multi-let leasehold stock brings licensing into the same file. Consent to sublet under the lease is separate from a council HMO licence. Both can block a refinance. Our HMO licensing evidence note covers the council side. The lease still has to allow the letting pattern you are underwriting.

A lease that blocks a charge without landlord consent is a completion risk. Find the clause before you promise a completion date. If consent is required, start the application when the pack is first built, not after valuation. Landlord fees and turnaround times sit on the critical path. Auction buyers who discover the clause after the hammer burn deposit equity.

Subletting restrictions matter for any exit that assumes rental income. A lease that bans Assured Shorthold tenancies, or that demands consent for every new AST, changes both portfolio underwriting and term-lender appetite. Put the subletting clause in the broker note. Attach any existing consents. Do not assume a historic AST proves the lease allows the next one.

Alteration and works clauses shape light refurbishment bridges. A schedule that includes structural openings, loft conversions or facade changes may need landlord consent and sometimes freeholder approval of plans. Heavy works may belong on development finance with staged drawdowns rather than on a short bridge that assumed DIY consent. Mixing a full rebuild programme into a leasehold bridge email is how files bounce between desks.

Absolute covenants and unusual user clauses belong on page one of the solicitor note. A restriction that limits use to a single private dwelling can clash with a planned HMO exit. A clause that forces membership of an estate company with open-ended fees needs a figure. Credit will ask. Answer before the valuation instruction goes out.

Share of freehold structures still need the lease and the freehold title. Charging only the lease while the borrower also controls a slice of freehold can be the right answer. Charging the wrong title is the wrong answer. Draw it. Name the title numbers. Send both registers when both sit in the security story.

How the leasehold pack sits beside title exit and SOF evidence

Leasehold evidence is one zip in a larger file. It does not replace register, exit or money papers.

Title still has to be chargeable. Send the register and plan. Existing charges need balances. Refinance bridges need the redemption statement pack when a prior charge is being repaid. Auction lots still need the full legal pack with special conditions. The leasehold pages above sit inside those packs when tenure is leasehold. They are not optional extras.

Exit still needs proof. A sale memo without a diary fails for the reasons in our sale-exit pack. A refinance illustration that assumes a term the lease cannot support fails even if the LTV looks clean. Soft buyer demand and tighter secured credit in recent prints make lease problems less forgiving, not more. Plan B belongs in writing. Sale if refinance shortens. Refinance if the sale stalls. Equity if both slip.

Deposit and equity cash still need a trail. Source of funds sits beside the lease. A clean lease with an unexplained round-sum deposit still stalls. A clean deposit with a sixty-year term and doubling rent still stalls. Send both zips together.

Identity and company papers still sit at the front. Passport. Proof of address. SPV and PSC extracts. Personal guarantees when the structure needs them. Leasehold does not waive KYC. It adds tenure risk on top of it.

Brokers who work with StatusKWO through the broker desk should treat leasehold as a first-email filter. Freehold and leasehold are different products on the same rate card only when the papers match. The rate card does not cure a missing consent or a major works notice.

What brokers should send with the first leasehold enquiry

Send one zip. Name the files so a human can open them without decoding “scan4”.

  1. One-pager with address, title number, unexpired term, ground rent, service charge, arrears, consent-to-charge, loan, exit and borrower names.
  2. Official copies of the register and title plan.
  3. Official or certified copy of the lease, not a marketing summary.
  4. Latest ground rent demand and proof of payment or an arrears schedule with a clearance plan.
  5. Service charge demands or accounts for recent years, plus any major works notice.
  6. Management pack replies if already obtained, or a dated request showing they are on order.
  7. Landlord consent application or confirmation when the lease requires consent to charge, sublet or alter.
  8. Exit evidence that survives the remaining term, plus Plan B.
  9. Source-of-funds schedule for deposit, equity and any arrears clearance cash.
  10. Identity, SPV and charge papers that match the borrower who will own the lease.

If the lot is an auction purchase, add memorandum, deposit receipt and special conditions from the auction packs already on the newsroom. If the bridge is a refinance, add the redemption statement and charge discharge papers. If works sit inside the facility, add a costed schedule and flag every consent the lease demands before those works start.

Do not wait for credit to ask for the lease. The freehold twin may have cleared without it. The leasehold file will not.

A practical next step is a decision in principle with the lease PDF attached on day one. Credit can then say whether the term, rent and consents are workable before the borrower spends on valuation and landlord applications that were never going to clear.

Frequently asked questions

Does a specialist bridging lender accept short leasehold flats?

Sometimes, when the exit and structure still work. Credit reads the remaining term against the named take-out or sale. A simultaneous extension, extra equity or a cross-charge over stronger security can repair a tight term. A bare promise that “extension is in hand” without solicitor papers and costings usually stalls the file.

Is a Land Registry title summary enough without the lease PDF?

No. The register shows tenure and often points to a filed lease. Ground rent, escalation, service charge mechanics and consent-to-charge sit in the lease wording. GOV.UK lease guides expect buyers to see the lease. Specialist desks take the same view on commercial bridges.

Do new leases under the 2022 Ground Rent Act still need rent evidence?

Yes. Confirm the grant date and the rent clause. Most regulated new long residential leases are limited to a peppercorn, but existing leases keep contractual ground rent and many auction and refinance files are older stock. Credit still wants the clause and the latest demand on the page.

What service charge papers stall a leasehold bridge fastest?

Arrears without a clearance plan, missing recent demands and live major works notices that were never disclosed. A refinance or sale exit that ignores a roof or cladding programme usually fails when the management pack arrives late. Put the figures next to the loan amount in the first zip.

Only when the lease says so. Many leases require written consent before a charge can be registered. Start that application early. Landlord fees and turnaround sit on the completion clock, especially on auction dates that do not move.