Egremont 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. It is the case that most Egremont tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Egremont you should check if your lease has between 70 and 90 years remaining. There are compelling reasons why a Egremont leaseholder with a lease having around 80 years left should take steps to make sure that a lease extension is effected without delay
Leasehold properties in Egremont with more than 100 years outstanding 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 property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Egremont can be a difficult process. We recommend you procure professional help from a conveyancer 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 dealing with Egremont lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jamie owned a high value flat in Egremont being sold with a lease of fraction over 72 years left. Jamie on an informal basis approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Jamie to exercise his statutory right. Jamie procured expert advice and secured an acceptable resolution informally and readily saleable.
Last Christmas we were e-mailed by Dr Poppy Brown , who took over the lease of a garden flat in Egremont in November 2004. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Comparative properties in Egremont with a long lease were valued around £200,000. The mid-range amount of ground rent was £50 collected per annum. The lease elapsed on 26 April 2104. Taking into account 78 years as a residual term we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of professional charges.
In 2013 we were called by Dr Erin Lambert who, having owned a garden apartment in Egremont in August 2001. The question was if we could approximate the price could be to extend the lease by an additional years. Comparative homes in Egremont with a long lease were valued about £267,600. The mid-range ground rent payable was £65 collected per annum. The lease concluded in 2093. Having 67 years left we estimated the premium to the landlord to extend the lease to be within £14,300 and £16,400 exclusive of legals.