Extending your lease is one of the most valuable decisions you can make as a leaseholder — but it does come at a cost. Whether your lease is nearing the 80-year mark or already short, the price of a lease extension can run into thousands of pounds. Fortunately, there are several ways to fund this process, from savings and remortgaging to bridging loans.
This guide breaks down the full range of options available, including timescales, financial planning tips, and how to avoid common pitfalls.
Its important to remember that you wont be expected to pay the total cost all upfront. As the lease extension process typically takes 6 to 12 months end to end, around 20% of the overall anticipated cost is payable upfront with the remainder on completion so you will have a significant amount of time to arrange or save the funds required. Call us for a free no obligation quotation.
What Costs Do You Need to Fund?
A lease extension isn’t just a one-line invoice — it’s made up of multiple components. Here’s what to budget for:
1. Premium (The Extension Price)
This is the amount paid to your freeholder to extend your lease. It’s based on:
- Your flat’s market value
- Length of remaining lease
- Ground rent terms
- Whether marriage value applies (if lease < 80 years)
This can range from a few thousand to tens of thousands of pounds depending on location and lease length.
2. Freeholder’s Legal and Surveyor Costs
Under statutory rules, you’re required to pay the freeholder’s “reasonable” costs — typically around £2,500–£3,000 + VAT.
3. Your Own Legal Fees
Solicitor fees generally range from £1,750–£2,000 + VAT, plus disbursements (Land Registry fees, ID checks, etc.)
4. Valuation Fees
Expect to pay a survey fee of £750–£1,000 + VAT, depending on complexity. At Extension.Lease, desktop valuations keep costs efficient.
Funding Options Explained
1. Savings or Cash Reserves
The simplest option — no debt, no interest, full control.
Best if:
- You have sufficient funds available
- You want to avoid borrowing or delays
2. Remortgaging
Use a new or updated mortgage to release equity from your property.
How it works:
- Get a lease extension valuation first
- Extend your lease (or start the process)
- Remortgage once lease term is improved and lender criteria are met
Important: Most lenders require at least 80 years remaining to proceed.
If your lease is short:
- Extend first, then remortgage
- Or complete the lease extension and remortgage simultaneously
3. Bridging Loan or Short-Term Finance
Specialist lenders offer fast, flexible funding — usually secured against your property.
Pros:
- Access funds quickly
- Doesn’t require long lease upfront
- Can bridge the gap until you remortgage or sell
Cons:
- Higher interest rates
- Typically repaid within 6–18 months
4. Loan from Family or Friends
Can be informal or documented with legal advice.
Best if:
- You have family support
- You’re in a transition period (e.g. before a sale)
Can You Fund It After Sale or Remortgage?
Yes — but only if structured properly.
For example:
- Serve a Section 42 Notice, then assign the benefit to the buyer
- Complete the lease extension after the sale
- Buyer can use mortgage funds to fund the extension
This approach protects value without needing upfront funds.
Tips for Managing Costs
- Start early: Planning ahead gives you time to budget or arrange finance
- Instruct fixed-fee professionals: Avoid open-ended costs
- Get premium estimates: Use Blake’s for a professional valuation before committing
- Ask your solicitor for cost estimates upfront
FAQs
Can I remortgage with a short lease?
Usually not. Most lenders require 80+ years. Extend first, then apply.
Can the premium be paid in instalments?
No — the premium must be paid in full upon completion.
Can the buyer pay for the lease extension?
Yes — if you serve the notice and assign the benefit, the buyer can fund and complete the extension.
What if I’m inheriting the flat?
Executors can begin the lease extension process and sell the flat with the benefit of the notice assigned.
Summary: Funding Paths
| Option | Suitable For |
| Savings | Most straightforward |
| Remortgage | Post-extension or after raising value |
| Bridging loan | Quick access when cashflow is tight |
| Family loan | Flexible and informal |
| Solicitor instalments | Managing short-term legal costs |
Need Help Estimating Your Lease Extension Cost?
At Extension.Lease, we provide:
- Fixed-fee, RICS-compliant valuations
- Advice on timing and cost planning – a realistic cost of the whole process, before you start so you can proceed with confidence.
