Chesterfield Lease Extension - Free Consultation

Before you progress with your lease extension in Chesterfield
Get a quote from one of our lease extension experts with over 20 years experience.

Let them guide you for FREE on the various options available to you.

It may end up saving you thousands.

Why you should start your Chesterfield lease extension


Main reasons to start your Chesterfield lease extension today:

Increase your lease and increase your Chesterfield property value

Chesterfield leases on residential properties are gradually losing value. if your lease has about 90 years left, you should start considering the need for a lease extension. It is important to recognise that it is that it is desirable for the lease extension to take place before the term of the current lease drops below eighty years - otherwise a higher premium will be payable. Leasehold owners in Chesterfield will mostly qualify for a lease extension; however It would be wise to check with a conveyancing solicitor to confirm if you qualify. In certain circumstances you may not be entitled. There are prescribed deadlines and formalities to follow once the process is triggered so it’s sensible to be guided by a conveyancer during the process.

An extended lease is almost the same value as a freehold

It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years remaining, the residence will be worth the same as a freehold for many years ahead.

Lending institutions may decide not to lend with a short lease

The propensity since the credit crunch has been for lenders to tighten lending criteria generally - this has extended to the property over which the mortgage is to be charged. This has meant the unexpired lease term required by banks has increased. In the past lenders would lend on a lease with 25 years plus the term of the loan - routinely 50 year leases but those requirements are being increasingly undermined by the requirement for longer and longer leases - many now have a minimum term of 75 years as a prerequisite.

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.
Halifax Minimum 70 years from the date of the mortgage.
Nationwide Building Society - Our minimum unexpired lease term is 55 years, except where lending is over 85% of the purchase price/valuation on a second hand flat, in which case our minimum unexpired term is 90 years.
- There must be at least 30 years remaining at the end of the mortgage term (regardless of the length of lease at the start).

Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:

Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
- Where lending is over 85% of the purchase price/valuation on a second hand flat and the unexpired lease term on the offer is 90 years or more - only advise us if the actual lease term is less than 90 years.

New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer

Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.

SECOND HAND PROPERTIES

Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 55 years
- Unexpired lease term less than 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period is less than or equal to 5 years

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 55 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial, etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years (Minimum 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat)
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI

NEW BUILD PROPERTIES (includes office conversions)

Unacceptable - advise Issuing Office (Will be declined)
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house (does not apply to Shared Ownership)
- Any lease which is subject to a Ground Rent (or Annual Rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a Ground Rent (or Annual Rent) being charged which is more than on a peppercorn basis

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn Ground Rent (Annual Rent) charges

For the avoidance of doubt, any New Build properties completed but not sold pre-30 June 2022 will only be acceptable if the Lease conforms to the above guidance.

* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years.

Lease Extensions

We require all Lease Extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where you become aware that it does not meet these requirements, please refer to Issuing Office.
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
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.

Why use us for your lease extension in Chesterfield?

Lease extensions in Chesterfield can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer with experience in lease extensions.

We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Chesterfield lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.

Chesterfield Lease Extension Case Studies:

Hugo, Chesterfield, Derbyshire

Half a year ago Hugo, came dangerously close to the 80-year threshold with the lease on his one bedroom apartment in Chesterfield. In buying his flat two decades ago, the unexpired term was of minimal interest. Luckily, it dawned on him that he needed to take steps soon on Extending the lease. Hugo was able to extend his lease just under the wire last April. Hugo and the landlord who owned the flat above in the end agreed on sum of £6,000 . If the lease had slid to less than 80 years, the figure would have escalated by a minimum £925.

Chesterfield case:

Dr Mollie Moore completed a ground floor flat in Chesterfield in April 2001. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Comparable homes in Chesterfield with 100 year plus lease were worth £285,000. The average amount of ground rent was £55 invoiced quarterly. The lease came to a finish in 2103. Considering the 79 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 not including expenses.

Chesterfield case:

Dr Thomas Nelson bought a garden flat in Chesterfield in August 2001. We are asked if we could estimate the premium would likely be for a ninety year lease extension. Comparable residencies in Chesterfield with 100 year plus lease were valued about £198,400. The mid-range amount of ground rent was £65 collected per annum. The lease concluded in 2083. Given that there were 59 years outstanding we approximated the premium to the freeholder to extend the lease to be between £21,900 and £25,200 exclusive of professional charges.