Why short leases matter
A lease is a wasting asset: each year that passes, the property is held for one year less. Once a lease falls below around 80 years, the cost of extending it rises, because the freeholder can claim a share of the increase in value known as marriage value. Many mortgage lenders also set a minimum unexpired term, often 70 to 85 years, which limits buyers and refinance options.
Bridging lenders set their own minimums too, often measured at the end of the bridge. On our panel, minimums range from around 50 to 85 years depending on the lender, and a few lenders state that they consider short leases or fund lease extensions specifically.
How lease extensions work
Owners of flats can usually extend their lease under statute, which has traditionally added 90 years and reduced the ground rent to a peppercorn, in return for a premium. The Leasehold and Freehold Reform Act 2024 provides for 990-year extensions once those provisions are in force, so confirm the current position with a solicitor. Owners of leasehold houses have separate rights. A lease can also be extended informally by agreement with the freeholder, although the terms may be less favourable.
The rules on lease extensions have been changing under the Leasehold and Freehold Reform Act 2024, with provisions coming into force in stages. A specialist solicitor and valuer will confirm the current position, the premium and the timetable for your case.
Structuring the bridge
A common approach is to buy the property with a bridge, extend the lease, and then refinance onto a mortgage or sell at the higher value. The Leasehold and Freehold Reform Act 2024 removed the two-year ownership requirement for statutory lease extensions from 31 January 2025, so a buyer can generally serve notice straight after completion. A seller can also start the process and assign the benefit of their notice to you on completion. A specialist solicitor will confirm the right route for your case.
Lenders will want to see the lease, the extension premium and costs, the expected timetable and valuations with both the current and the extended lease. The bridge term should allow for the extension to complete, with headroom for negotiation or a tribunal hearing.
Arranging short lease bridging
We compare lenders on their minimum lease terms, appetite for lease extensions, loan to value and exit, then approach those that fit with a clear case. Instant Quotes lets you flag a lease with under 85 years left, as a starting point. Final terms depend on each lender's valuation and legal checks.
If the borrower is an individual or the trustees of a trust, and the property is, or will be, lived in by you or a close family member, the loan is a regulated mortgage contract with additional protections. We will tell you at the outset if that applies and how your case will be handled. Your home or property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
