The closer a residential lease in Borth gets to zero years unexpired, the more it reduces the value of the property. Where the lease has, over 99 years remaining then this decrease may be negligible however there will become a point in time when a lease has under than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the main rational as to why you should extend the lease without delay. Many flat owners in Borth will meet the qualifying criteria; that being said a conveyancing solicitor can confirm if you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold properties in Borth with in excess of 100 years remaining 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 premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with procure Borth 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 conveyancing solicitor we work with provide it.
Ben was the the leasehold owner of a studio flat in Borth being marketed with a lease of just over fifty eight years left. Ben informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Ben to exercise his statutory right. Ben obtained expert advice and was able to make an informed decision and deal with the matter and ending up with a market value flat.
In 2010 we were phoned by Mr Dexter Clarke who, having moved into a one bedroom apartment in Borth in January 2007. We are asked if we could approximate the premium would be to prolong the lease by 90 years. Identical premises in Borth with a long lease were in the region of £200,800. The average amount of ground rent was £65 collected annually. The lease elapsed on 16 June 2086. Given that there were 60 years left we approximated the compensation to the landlord for the lease extension to be between £20,900 and £24,200 plus professional charges.
In 2009 we were approached by Mr Stanley Hall who, having completed a basement flat in Borth in November 2007. The dilemma was if we could approximate the premium would likely be to extend the lease by 90 years. Comparable residencies in Borth with 100 year plus lease were worth £255,000. The mid-range ground rent payable was £50 collected per annum. The lease ended in 2097. Taking into account 71 years remaining we approximated the premium to the landlord for the lease extension to be between £9,500 and £11,000 not including costs.