On the balance of probabilities if you own a flat in Ashbourne you actually own a long leasehold interest over your property
Leasehold premises in Ashbourne with more than 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
Lender | Requirement |
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Bank of Scotland | Minimum 70 years from the date of the mortgage. |
Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
Santander | 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 However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis 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. |
Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
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. |
The lawyers that we work with handle Ashbourne lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Ben owned a conversion apartment in Ashbourne on the market with a lease of just over sixty years remaining. Ben informally spoke with his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £200 annually. No ground rent would be payable on a lease extension were Ben to exercise his statutory right. Ben obtained expert legal guidance and secured satisfactory deal without going to tribunal and ending up with a market value flat.
Last Autumn we were approach by Mr and Mrs. R Scott , who took over the lease of a first floor apartment in Ashbourne in August 2001. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by ninety years. Identical homes in Ashbourne with an extended lease were worth £223,400. The average amount of ground rent was £60 billed yearly. The lease lapsed on 9 September 2083. Considering the 59 years outstanding we calculated the premium to the landlord to extend the lease to be within £27,600 and £31,800 not including legals.
Mrs T David took over the lease of a studio apartment in Ashbourne in March 2007. We are asked if we could shed any light on how much (roughly) premium could be to prolong the lease by a further 90 years. Comparable premises in Ashbourne with 100 year plus lease were worth £205,000. The mid-range amount of ground rent was £50 invoiced annually. The lease ended in 2103. Having 79 years unexpired we approximated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of professional charges.