With a residential leasehold premises in Ferndown, you are actually buying a right to live in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately greater notably once there are fewer than 80 years remaining. Anyone in Ferndown with a lease nearing 81 years remaining should seriously consider extending it as soon as possible. Once the lease term has under 80 years remaining, under the relevant statute the freeholder is entitled to calculate and charge a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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 handle Ferndown 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.
Trailing unsuccessful correspondence with the freeholder of her first floor apartment in Ferndown, Rosie commenced the lease extension process as the eighty year deadline was swiftly coming. The transaction completed in August 2015. The freeholder’s fees were negotiated to slightly above five hundred pounds.
In 2012 we were e-mailed by Mr and Mrs. C Garcia who, having bought a one bedroom apartment in Ferndown in February 2003. We are asked if we could approximate the premium would be to prolong the lease by a further 90 years. Similar flats in Ferndown with a long lease were worth £179,200. The mid-range amount of ground rent was £55 collected monthly. The lease elapsed on 3 July 2077. Taking into account 51 years unexpired we calculated the premium to the landlord to extend the lease to be between £31,400 and £36,200 plus fees.
Mr E James bought a garden flat in Ferndown in July 2006. We are asked if we could shed any light on how much (approximately) price would be to extend the lease by a further 90 years. Comparable premises in Ferndown with a long lease were in the region of £285,000. The mid-range amount of ground rent was £45 billed quarterly. The lease expired in 2097. Given that there were 71 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 not including professional charges.