Honor Oak leases on domestic deteriorating in value. if your lease has approximately ninety years unexpired, you should start thinking about a lease extension. If lease term falls under eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to your landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Leasehold owners in Honor Oak will mostly be legally entitled to a lease extension; however a solicitor should be able confirm if you qualify. In certain cases you may not qualify. There are also strict deadlines and steps to follow once the process has commenced so it’s wise to be guided by a conveyancer during the process.
Leasehold properties in Honor Oak with over 100 years left 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 circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify 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; |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancers that we work with undertake Honor Oak 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 conveyancer we work with provide it.
Twenty four months ago Hunter, came perilously close to the 80-year mark with the lease on his studio apartment in Honor Oak. In buying his home two decades ago, the length of the lease was of no concern. Luckily, he noticed he needed to take action soon on Extending the lease. Hunter was able to extend his lease just ahead of time in June. Hunter and the landlord subsequently agreed on the final figure of £6,000 . If the lease had gone lower than eighty years, the amount would have increased by at least £950.
In 2014 we were contacted by Mr H Michel who, having owned a basement apartment in Honor Oak in January 2005. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Similar premises in Honor Oak with a long lease were worth £208,600. The mid-range ground rent payable was £60 billed monthly. The lease ran out on 9 March 2082. Considering the 57 years left we approximated the compensation to the landlord for the lease extension to be within £30,400 and £35,200 plus legals.
An example of a Lease Extension case for a Honor Oak property is Flat 1 40-42 Ewelme Road in August 2012. the Tribunal assessed the premium for the lease extension in the sum of £11,800 This case was in relation to 1 flat. The unexpired lease term was 61.81 years.