Clacton On Sea residential property held on a long lease is a wasting asset because a leaseholder only owns the property for a period of years.
Leasehold premises in Clacton On Sea with over one hundred 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 property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| 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. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you increased control over the value of your Clacton On Sea leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
18 months ago Jackson, came very close to the 80-year threshold with the lease on his one bedroom flat in Clacton On Sea. In buying his flat 18 years previously, the length of the lease was of no importance. As luck would have it, he recognised he would soon be paying way over the odds for a lease extension. Jackson extended the lease at the eleventh hour last August. Jackson and the freeholder via the management company subsequently agreed on sum of £5,500 . If he had missed the deadline, the premium would have increased by a minimum £875.
Mr and Mrs. J Miller moved into a one bedroom apartment in Clacton On Sea in October 2006. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by ninety years. Similar flats in Clacton On Sea with an extended lease were valued about £256,600. The average ground rent payable was £60 collected annually. The lease finished on 24 November 2077. Taking into account 52 years left we estimated the compensation to the landlord to extend the lease to be between £39,000 and £45,000 plus professional charges.
Mr C Lefebvre purchased a basement flat in Clacton On Sea in August 2009. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Comparative flats in Clacton On Sea with a long lease were in the region of £218,000. The mid-range amount of ground rent was £45 collected every twelve months. The lease expiry date was on 28 February 2088. Given that there were 63 years remaining we approximated the compensation to the landlord for the lease extension to be within £17,100 and £19,800 exclusive of fees.