Disley leases on residential properties are gradually losing value. Where your lease has approximately ninety years left, you should start considering the need for a lease extension. 80 years is a significant number: when the remaining term of a lease falls below this level then you start incurring an additional element called marriage value. Leasehold owners in Disley will usually be legally entitled to a lease extension; however a solicitor will check your eligibility. In certain circumstances you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced so it’s best to be guided by a conveyancer during the process.
Leasehold properties in Disley with over 100 years outstanding on the lease are often 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 buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with undertake Disley 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.
Gabriel owned a conversion apartment in Disley being marketed with a lease of just over 72 years left. Gabriel on an informal basis spoke with his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £125 yearly. Ordinarily, ground rent would not be payable on a lease extension were Gabriel to exercise his statutory right. Gabriel obtained expert legal guidance and was able to make a more informed judgement and deal with the matter and sell the property.
In 2011 we were approached by Ms Sian Gunderson who, having took over the lease of a basement apartment in Disley in May 2003. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by 90 years. Comparative homes in Disley with an extended lease were worth £200,000. The mid-range amount of ground rent was £50 billed quarterly. The lease terminated in 2104. Considering the 78 years unexpired we estimated the premium to the landlord to extend the lease to be within £8,600 and £9,800 plus fees.
Last month we were contacted by Ms Bethany Nelson , who completed a purpose-built flat in Disley in March 2000. The dilemma was if we could approximate the premium could be for a 90 year lease extension. Comparative homes in Disley with an extended lease were in the region of £267,600. The mid-range amount of ground rent was £65 billed monthly. The lease came to a finish in 2093. Considering the 67 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £14,300 and £16,400 not including fees.