The re-sale value of a leasehold property in Bollington depends on how many years the lease has remaining. If it is close to or less than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension before purchasing. Ideally one should start the process of extending the lease is when a lease still has 82 years unexpired so that a lease extension can be finalised in advance of the eighty year mark. Statute entitles Bollington qualifying lessees to acquire a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The reason of the valuation is to determine the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Bollington with more than 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 procure Bollington 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.
Mason owned a studio flat in Bollington on the market with a lease of a little over sixty years remaining. Mason informally approached his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £50 per annum. No ground rent would be payable on a lease extension were Mason to invoke his statutory right. Mason procured expert advice and was able to make a more informed judgement and deal with the matter and sell the property.
Mrs Hannah Kelly took over the lease of a recently refurbished flat in Bollington in June 1995. The dilemma was if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Comparable flats in Bollington with a long lease were in the region of £225,800. The average amount of ground rent was £60 invoiced annually. The lease termination date was on 13 January 2086. Taking into account 60 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £24,700 and £28,600 plus fees.
Last Autumn we were contacted by Mr and Mrs. S Flores , who purchased a one bedroom flat in Bollington in March 2012. We are asked if we could shed any light on how much (approximately) premium could be to extend the lease by 90 years. Similar residencies in Bollington with 100 year plus lease were in the region of £210,000. The mid-range ground rent payable was £50 invoiced monthly. The lease end date was in 2106. Given that there were 80 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus professional charges.