If you are facing a significant premium because your lease in Altrincham has dropped toward the 80-year mark, your previous lawyer may be at fault. Our panel of experts specialise in recovering lease extension costs from negligent firms who failed to protect your investment.
Top reasons for lease extension now:
Increase your lease and increase your Altrincham property value
As the length of the unexpired term of a Altrincham domestic lease diminished so does its value and therefore the value of your property. Where the lease has, in excess of 99 years to run then this decrease may be negligible that being said there will become a stage when a lease has fewer than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the primary rational as to why you should consider extending without delay. The majority of flat owners in Altrincham will qualify for this right; however a conveyancer can confirm whether you qualify for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have owned the property for under two years.
Altrincham property with a lease extension is almost the same value as a freehold
Leasehold residencies in Altrincham with more than 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges merit it.
Lenders may not loan monies on a short lease
Most banks have tightened lending criteria in recent years and borrowers are finding it increasingly difficult to raise funding or re-mortgage against flats with shorter lease terms, particularly below 75 years as they are deemed to be insufficient security.
| Lender |
Requirement
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| Barnsley Building Society |
60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term.
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| Santander |
If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or
2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or
3. no valuation report is provided.
We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder.
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| The Mortgage Works |
Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term.
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 70 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period less than or equal to 5 years
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 70 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Issuing Office (will be declined):
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house
- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn ground rent (annual rent) charges
For the avoidance of doubt, any new build properties completed but not sold pre 30 June 2022 will only be acceptable if the lease conforms to the above guidance
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years
Lease Extensions We require all Lease Extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where a proposed Lease Extension does not meet these requirements, however you feel that this is in the best interest for our mutual client, please refer all details to the Issuing Office for us to consider.
Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
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| Royal Bank of Scotland |
Mortgage term plus 30 years.
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| Yorkshire Building Society |
85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower.
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Why use us for your lease extension in Altrincham?
Lease extensions in Altrincham can be a difficult process. We recommend you procure guidance from a conveyancer and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Altrincham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Altrincham Lease Extension Case Studies:
Cameron, Altrincham, Greater Manchester
Last Summer Cameron, came very close to the eighty-year mark with the lease on his basement apartment in Altrincham. Having purchased his flat 18 years ago, the unexpired term was of no interest. Luckily, he realised he needed to take action soon on Extending the lease. Cameron extended the lease just under the wire last June. Cameron and the landlord who owned the flat above subsequently settled on the final figure of £5,000 . If the lease had slipped to less than 80 years, the sum would have become more exhorbitant by a minimum £1,000.
Altrincham case:
In 2012 we were phoned by Dr Jamie Martin who, having purchased a one bedroom apartment in Altrincham in September 1997. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by an additional years. Comparative homes in Altrincham with 100 year plus lease were in the region of £260,200. The average ground rent payable was £65 billed yearly. The lease concluded on 8 July 2092. Taking into account 66 years remaining we estimated the premium to the freeholder for the lease extension to be within £16,200 and £18,600 exclusive of professional charges.
Altrincham case:
In 2014 we were called by Mr and Mrs. H Murphy who, having acquired a basement apartment in Altrincham in August 1998. The question was if we could shed any light on how much (approximately) price would likely be to prolong the lease by a further 90 years. Identical flats in Altrincham with a long lease were valued about £198,800. The average ground rent payable was £55 billed per annum. The lease came to a finish on 28 October 2081. Given that there were 55 years outstanding we calculated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 not including legals.