For anyone whose Barrow In Furness property is held on a long lease, our message is clear – if you do nothing, the property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to obtain a lease extension.
It is generally considered that a residential leasehold with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
Lender | Requirement |
---|---|
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; |
National Westminster Bank | Mortgage term plus 30 years. |
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 |
TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you increased control over the value of your Barrow In Furness leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy negotiations with the landlord of her purpose-built apartment in Barrow In Furness, Kate initiated the lease extension process as the eighty year threshold was quickly advancing. The lease extension was finalised in January 2005. The freeholder’s charges were kept to an absolute minimum.
Dr Kelsey Morris owned a purpose-built flat in Barrow In Furness in November 1995. We are asked if we could estimate the price could be for a 90 year extension to my lease. Similar homes in Barrow In Furness with 100 year plus lease were valued about £256,600. The mid-range ground rent payable was £60 invoiced every twelve months. The lease finished on 12 January 2076. Taking into account 52 years remaining we calculated the compensation to the freeholder to extend the lease to be within £39,000 and £45,000 not including expenses.
Mr and Mrs. T Bennett bought a ground floor apartment in Barrow In Furness in March 2000. The dilemma was if we could shed any light on how much (approximately) premium would be to extend the lease by ninety years. Comparable flats in Barrow In Furness with a long lease were valued around £218,000. The average ground rent payable was £45 billed annually. The lease ran out in 2087. Considering the 63 years remaining we calculated the premium to the freeholder for the lease extension to be between £17,100 and £19,800 plus professional charges.