Crowborough leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Crowborough residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Crowborough you should check if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Crowborough with over one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Crowborough 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 lawyer we work with provide it.
John owned a studio flat in Crowborough being marketed with a lease of just over sixty years left. John on an informal basis spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were John to invoke his statutory right. John obtained expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
Mr and Mrs. V Bennett acquired a basement flat in Crowborough in November 1995. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparative homes in Crowborough with 100 year plus lease were valued about £200,800. The mid-range amount of ground rent was £65 collected monthly. The lease elapsed in 2085. Considering the 60 years left we estimated the compensation to the landlord to extend the lease to be within £20,900 and £24,200 exclusive of expenses.
Ms Rosie Harris took over the lease of a studio apartment in Crowborough in March 2003. The question was if we could approximate the compensation to the landlord could be to extend the lease by a further 90 years. Comparable premises in Crowborough with a long lease were valued about £255,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease ran out on 19 August 2096. Considering the 71 years unexpired we approximated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus expenses.