FTB - flat needs lease extension….how does this work?

[DFOD]

Relative considering a flat with a 85 year lease - been told it will cost £15k to extend.

How does this work?

Will a mortgage company lend on this short lease to FTB - they have the additional funds to do it. Or does the buyer drop the price by 15k upfront?

How long does it take and are there any risks involved?

I imagine the price it was marketed for took into account the short lease so asking for a reduction probably won’t fly.
The mortgage company are unlikely to lend the additional £15k.
How long will this extend it by, and is it something they really love.

85 years is technically ok - it’s below 80 when it gets much more expensive and most banks won’t lend. However you can’t start the extension process until you have owned the property for 2 years and it can take a long time - I’ve heard average 6 months to a year. So it’s doable but on the edge.

Standard extension is 90 years on top of remaining lease. Also the new lease will not be subject to ground rent.

We recently sold a leasehold property in a probate case, we extended the lease as a condition of the sale, so the buyer benefitted from the longer lease and we paid the costs.

Who the freeholder is has a bearing. My building is (essentially) share of freehold and we're extending ours and it's still taking a long time, even though all the owners are in agreement

Worth bearing in mind that unless the seller starts the process of extending the lease, a new owner has to wait 2 years to do it.

Leasehold law for properties with existing leases will change at some point in future…is in a v v slow pipeline. Probably won’t be anything for 5 years so you will have to extend really. You could walk away and find something else. If you mention it’s due to lease, they might lower price. If you could decide it’s aggro you don’t need.