For anyone whose Biggleswade home is held on a long lease, our message is clear – if you ignore the situation, the property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more it will cost to extend the lease.
Leasehold residencies in Biggleswade with in excess of one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Biggleswade 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.
In recent months Jonathan, came very near to the 80-year threshold with the lease on his basement apartment in Biggleswade. Having purchased his home twenty years previously, the lease term was of no significance. Thankfully, he realised he would soon be paying an escalated premium for a lease extension. Jonathan arranged for a lease extension at the eleventh hour last September. Jonathan and the freeholder via the management company ultimately settled on sum of £6,000 . If the lease had descended below eighty years, the price would have increased by a minimum £975.
In 2009 we were phoned by Ms Anna Bertrand who, having was assigned a lease of a one bedroom flat in Biggleswade in July 2010. We are asked if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Comparable homes in Biggleswade with 100 year plus lease were in the region of £275,000. The mid-range amount of ground rent was £55 invoiced yearly. The lease end date was on 26 February 2102. Considering the 77 years as a residual term we calculated the premium to the landlord to extend the lease to be within £13,300 and £15,400 plus fees.
In 2014 we were e-mailed by Mr P Mason who, having completed a garden flat in Biggleswade in September 1995. The question was if we could approximate the premium would likely be for a 90 year lease extension. Comparable flats in Biggleswade with 100 year plus lease were worth £183,600. The mid-range amount of ground rent was £65 collected per annum. The lease expired in 2082. Given that there were 57 years remaining we estimated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 plus fees.