Caversham leases on domestic deteriorating in value. if your lease has approximately ninety years left, you should start thinking about a lease extension. If lease term is under 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Caversham will mostly qualify for a lease extension; however a solicitor should be able check your eligibility. In some cases you may not qualify. There are prescribed deadlines and formalities to comply with once the process is triggered so it’s prudent to be guided by a conveyancer during the process.
Leasehold residencies in Caversham with in excess of 100 years remaining 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 premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges warrant it.
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
Regardless of whether you are a tenant or a landlord in Caversham,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Caversham valuers.
In recent months Lucas, started to get close to the eighty-year threshold with the lease on his purpose- built flat in Caversham. In buying his home two decades ago, the lease term was of minimal importance. As luck would have it, it dawned on him that he would imminently be paying an escalated premium for a lease extension. Lucas was able to extend his lease just in the nick of time in August. Lucas and the landlord who owned the flat above in the end agreed on the final figure of £5,000 . If he not met the deadline, the amount would have escalated by a minimum £1,000.
Last Autumn we were approach by Dr A Parker , who was assigned a lease of a recently refurbished apartment in Caversham in February 2002. The question was if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year extension to my lease. Similar properties in Caversham with 100 year plus lease were valued about £254,200. The mid-range ground rent payable was £60 collected every twelve months. The lease concluded on 11 November 2076. Taking into account 51 years unexpired we approximated the premium to the landlord to extend the lease to be within £43,700 and £50,600 not including expenses.
In 2012 we were contacted by Dr Harriet Morris who, having owned a purpose-built flat in Caversham in August 2011. The question was if we could shed any light on how much (roughly) premium could be to prolong the lease by ninety years. Comparative premises in Caversham with a long lease were valued around £210,600. The mid-range amount of ground rent was £45 collected every twelve months. The lease concluded on 13 November 2087. Having 62 years left we approximated the premium to the landlord to extend the lease to be between £18,100 and £20,800 exclusive of fees.