With a domestic leasehold property in Chaddesden, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly notably once there are less than 80 years left. Leasehold owners in Chaddesden with a lease approaching 81 years remaining should seriously consider extending it as soon as possible. When a lease has under 80 years left, under the current Act the landlord can calculate and levy a greater premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold premises in Chaddesden with more than one hundred years outstanding 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 upside in buying 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. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle Chaddesden 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.
Two years ago Harvey, started to get near to the eighty-year mark with the lease on his first floor flat in Chaddesden. In buying his flat 18 years previously, the unexpired term was of minimal concern. Fortunately, he recognised he needed to take steps soon on a lease extension. Harvey was able to extend his lease at the eleventh hour in May. Harvey and the landlord who owned the flat above in the end agreed on the final figure of £5,500 . If he had missed the deadline, the price would have gone up by at least £1,000.
In 2011 we were contacted by Mr and Mrs. D Petit who, having completed a one bedroom apartment in Chaddesden in February 2008. We are asked if we could shed any light on how much (approximately) price would likely be for a 90 year lease extension. Similar flats in Chaddesden with an extended lease were valued around £166,400. The mid-range amount of ground rent was £60 collected every twelve months. The lease elapsed in 2080. Given that there were 54 years remaining we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 plus professional charges.
Dr Georgina Rogers moved into a basement apartment in Chaddesden in June 2003. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by 90 years. Comparative properties in Chaddesden with a long lease were worth £227,800. The average amount of ground rent was £45 collected yearly. The lease ended in 2091. Given that there were 65 years outstanding we calculated the premium to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of professional charges.