Is your flat still mortgageable? The issues lenders are increasingly concerned about

10th September 2026 | Asha Ngai | Residential Property, Leasehold Property, Mortgages

A buyer may love a flat, be able to afford it and have a mortgage agreed in principle. That does not necessarily mean their lender will lend on the property.

Mortgage lenders take security over the property they are financing. They therefore need to be satisfied that the property represents acceptable security, not only for the buyer today but also if the lender ever has to sell it.

This can make apparently technical legal issues surprisingly important.

Here are some of the issues that can cause difficulties.

Ground rent

Ground rent provisions have been under scrutiny for some time.

It is not necessarily just the amount of ground rent that matters. The provisions for future increases and the particular lender’s requirements may also need to be considered.

Government proposals to reform ground rents make this an area which is likely to continue evolving.

The length of the lease

A flat with a diminishing lease term may become more difficult to mortgage and sell.

Different lenders have different requirements and buyers should not assume that because one lender is prepared to lend, every lender will take the same approach.

Building safety

Building safety legislation has added another layer of complexity to transactions involving certain residential buildings.

Depending on the building and circumstances, solicitors may need to consider the Building Safety Act 2022 and associated documentation as part of the transaction.

This is a specialist area and assumptions should not be made simply on the basis of the appearance or age of the building.

Problematic lease provisions

Sometimes the problem is buried in a lease granted decades ago.

Rights of access, repairing obligations, insurance provisions and rights relating to the use of the building can all potentially affect mortgageability.

A solicitor acting for a buyer with a mortgage is not only advising the buyer. They will usually also be required to comply with the lender’s requirements.

That can mean raising issues which a cash purchaser might have been prepared to accept.

Alterations

Alterations carried out without the consent required by the lease can create another problem.

The issue may only come to light when the buyer’s solicitor reviews the lease against the current layout of the property.

Resolving the position can involve obtaining retrospective consent or considering another solution acceptable to the buyer and lender.

Why sellers should care about mortgage-ability

It is tempting to regard all of these as the buyer’s problem.

If a mainstream lender will not lend against a property, the pool of potential purchasers can become considerably smaller. That can affect both the speed of the sale and potentially the price achievable.

Sellers of leasehold properties should consider having their title and lease reviewed before the property is marketed.  If there is an issue that a lender is likely to raise, it is far better to know about it before accepting an offer.

Property transactions inevitably produce surprises. The role of an experienced residential property solicitor is to ensure that as few of those surprises as possible occur the week before exchange.

To find out more, please contact our Residential Real Estate Team.