Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will usually be granted for a fixed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Fenny Stratford. Inevitably, the term of lease left reduces as time goes by. This may pass by relatively unnoticed when the residence needs to be disposed of or re-mortgaged. The fewer the years remaining the lower the value of the property and the more it will cost to extend the lease. Qualifying long lease owners in Fenny Stratford have the right to extend the lease for an additional ninety years in accordance with statute. You should give due consideration before delaying your Fenny Stratford lease extension. Putting off the cost now likely increases the price you will eventually incur for a lease extension
Leasehold residencies in Fenny Stratford with in excess of 100 years unexpired on the lease are sometimes referred to as ‘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 to be gained by buying the freehold unless savings on ground rent and estate charges warrant 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
Retaining our service gives you better control over the value of your Fenny Stratford leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last October Joshua, came very near to the eighty-year mark with the lease on his two bedroom flat in Fenny Stratford. In buying his property 19 years previously, the lease term was of little significance. As luck would have it, he noticed he would soon be paying way over the odds for Extending the lease. Joshua arranged for a lease extension just under the wire last May. Joshua and the freeholder subsequently settled on a premium of £5,000 . If the lease had gone below eighty years, the premium would have escalated by at least £925.
In 2013 we were e-mailed by Mrs Eleanor Collins who, having moved into a garden flat in Fenny Stratford in April 2011. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by an additional years. Identical residencies in Fenny Stratford with 100 year plus lease were valued around £233,200. The mid-range amount of ground rent was £60 collected quarterly. The lease concluded on 19 August 2087. Considering the 61 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £22,800 and £26,400 plus expenses.
In 2011 we were called by Dr Mollie Morgan who, having acquired a first floor flat in Fenny Stratford in September 2000. The question was if we could shed any light on how much (approximately) premium would likely be for a 90 year extension to my lease. Comparable properties in Fenny Stratford with 100 year plus lease were valued around £166,800. The average ground rent payable was £50 billed every twelve months. The lease lapsed on 26 July 2076. Given that there were 50 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £32,300 and £37,400 plus expenses.