For those whose Eltham flat is held on a long lease, our message is clear – if no remedial action is taken, your property will ultimately revert to your landlord, leaving you empty-handed. The fewer the years remaining the less it is worth and the more it will cost to obtain a lease extension.
Leasehold premises in Eltham with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value 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 estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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 Eltham 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.
Off the back of protracted correspondence with the landlord of her one bedroom flat in Eltham, Georgina started the lease extension process as the eighty year threshold was fast advancing. The lease extension was concluded in June 2009. The freeholder’s fees were restricted to less than 550 GBP.
Last Winter we were e-mailed by Mr and Mrs. B Walker , who completed a one bedroom flat in Eltham in June 2005. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by 90 years. Comparable flats in Eltham with an extended lease were valued around £243,000. The average amount of ground rent was £65 invoiced annually. The lease concluded in 2089. Given that there were 63 years remaining we calculated the premium to the landlord to extend the lease to be between £20,000 and £23,000 plus legals.
An example of a Lease Extension matter before the tribunal for a Eltham premises is 103a Footscray Road in January 2014. The tribunal determines that the premium payable for the extended lease should be £34,500 according to the expert witness valuation calculation This case affected 1 flat.