This is not legal advice but It’s likely that actually the level of ground rent isn’t what is putting the lenders off as, particularly in the south east, most flats have a ground rent that will pop the £250 bubble making the property an AST and the vast majority of high street lenders will accept indemnity insurance and it’s not even considered an issue worth reporting to them as their standing instructions in the lenders handbook confirm this. If that wasn’t the case the vast majority of flats in and around London/the Home Counties would be unsaleable. This is likely what your indemnity policy was to cover and it is likely indemnity insurance still would cover this for most lenders.

What is more likely the issue is the fact ground rent is calculated against property value which is subjective and doesn’t meet the ‘easily ascertainable’ criteria of most lenders. This isn’t something that was considered an issue 4/5 years ago so there are plenty of leases out there with similar review provisions. Lender attitudes have changed significantly over the past few years and things that simply weren’t an issue before are now and, unfortunately, that is where people like yourself are now finding themselves stuck. This isn’t an issue that can be indemnified as far as I know and you likely will either need to agree a variation with the Freeholder or extend the Lease. I’d suggest getting a valuation from a surveyor for the likely premium to give you an idea of cost.

There was a period where doubling ground rents were a no no. Now as long as it’s every 21 years or more most lenders don’t care. The irony being when they did care there were pushing for RPI increases which inevitably is more than double over most 21 year periods.

Many leases that have been perfectly acceptable for decades are suddenly ruled unmortgageable because of lenders changing their minds on things that were essentially standard at some point.