Two Routes to a Longer Lease
When it comes to extending your lease, you have two options: the formal (statutory) route and the informal (voluntary) route. Both achieve the same end goal — a longer lease — but they differ significantly in terms of legal protection, cost, timescales, and what you actually receive.
Choosing the wrong route can cost you thousands. This guide breaks down exactly how each works so you can make the right decision.
The Formal (Statutory) Route
The formal route is your legal right under the Leasehold Reform, Housing and Urban Development Act 1993. If you’ve owned your flat for at least two years, your freeholder cannot refuse to extend your lease.
What You Get
- 90 years added on top of your current lease
- Ground rent reduced to a peppercorn (effectively £0)
- Full legal protection throughout the process
How It Works
- You serve a Section 42 notice on your freeholder
- The freeholder has two months to respond with a counter-notice
- If you can’t agree on a price, either party can apply to the First-tier Tribunal to determine the premium
- The entire process typically takes 6–12 months
Key Advantages
The formal route gives you certainty. Your freeholder can’t say no, the terms are set by law, and if they try to overcharge you, the Tribunal is there as a backstop. You also get the full 90 years plus zero ground rent — every time.
The Informal (Voluntary) Route
The informal route is simply a private negotiation between you and your freeholder. There’s no statutory framework — you agree whatever terms you can negotiate.
What You Might Get
- The lease length is whatever you negotiate — it could be 90 years, 125 years, or anything else
- Ground rent terms are negotiable — they might reduce it, keep it the same, or even increase it
- No legal protections if the freeholder decides to walk away
Key Risks
The biggest danger with the informal route is that you have no leverage. The freeholder can ask for whatever they want, change the terms at any point, or simply refuse to engage. There’s also no Tribunal to fall back on if you disagree on the price.
Many leaseholders are tempted by the informal route because it sounds quicker and cheaper. In reality, it often ends up costing more because:
- Freeholders know you have no statutory protection and price accordingly
- Additional lease terms may be slipped in that aren’t in your favour
- Ground rent may not be reduced to zero
- The lease extension may be shorter than 90 years
When the Informal Route Makes Sense
There are limited circumstances where the informal route might be appropriate:
- You haven’t owned the property for two years yet (so you don’t qualify for the formal route)
- Your freeholder is genuinely reasonable and has a track record of fair dealings
- You want terms that the formal route doesn’t offer (e.g., a 999-year lease)
Even in these cases, you should get professional advice before proceeding.
Our Recommendation
For the vast majority of leaseholders, the formal route is the better option. The legal protections, guaranteed terms, and Tribunal backstop far outweigh the perceived convenience of an informal deal.
The formal route exists specifically to protect leaseholders from being taken advantage of. Use it.
If you’re unsure which route is right for you, get your free lease report and we’ll advise you based on your specific situation.
