When it comes to domestic leasehold premises in East Ham, you are actually buying an entitlement to reside in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should think about extending the lease sooner rather than 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. Residents in East Ham with a lease approaching 81 years left should seriously consider extending it as soon as possible. When a lease has below eighty years left, under the current statute the freeholder is entitled to calculate and levy a larger amount, based on a technical calculation, strangely termed as “marriage value” which is due.
Leasehold residencies in East Ham with in excess of 100 years unexpired 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 home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with undertake East Ham 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.
Ben owned a 2 bedroom apartment in East Ham on the market with a lease of fraction over fifty eight years remaining. Ben on an informal basis spoke with his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Ben to exercise his statutory right. Ben procured expert legal guidance and was able to make a more informed decision and handle with the matter and readily saleable.
In 2011 we were approached by Dr E Patel who, having purchased a recently refurbished apartment in East Ham in October 1999. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year extension to my lease. Identical residencies in East Ham with 100 year plus lease were worth £201,200. The mid-range ground rent payable was £55 billed yearly. The lease terminated in 2081. Taking into account 56 years outstanding we calculated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 exclusive of costs.
An example of a Lease Extension decision for a East Ham flat is 46 Credon Road in January 2014. On 11 September 2013 Deputy District Judge Price sitting at the Bow County Court made a vesting order that the freeholder surrender his lease and be granted a new lease of the Premises on such terms as may be determined by the First Tier Tribunal (Property Chamber).The appropriate sum as concluded by the Tribunal was £7225 This case related to 1 flat. The unexpired term was 69.77 years.