Top reasons for Hungerford lease extension
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Main reasons to commence your Hungerford lease extension today:
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Increase your lease and increase your <a href="http://www.lendermonitor.com/conveyancing/loc/hungerford">Hungerford</a> property value </h4>
<p> The market value of a leasehold property in Hungerford is impacted by how long the lease has left to run. If it is near to or less than eighty years you should anticipate problems on re-sale, so it is advisable to arrange for the lease to be extended before buying. It is ideal to start the process of extending the lease is when the lease still has 82 years unexpired so that all matters can be concluded in advance of the 80 year cut off point. Leasehold Reform legislation entitles Hungerford qualifying lessees to an additional term of 90 years in addition to the unexpired term, at a notional rent (zero ground rent). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension. <h4>Hungerford property with a lease extension has roughly the same value as a freehold</h4>
<p> It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
<h4>Banks and Building Societies may decide not to loan monies with a short lease</h4>
The propensity since the credit crunch has been for mortgage companies to tighten lending criteria across the board - this has extended to the property over which the mortgage is to be granted. This has meant the unexpired lease term required by lenders has increased. In the past mortgage companies were content with twenty years plus the term of the loan - typically 50 year leases but those requirements evolved by the requirement for longer and longer leases - many now have a minimum term of 75 years as standard.
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<th> Requirement
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<td>Accord Mortgages</td>
<td> 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower.
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<td>National Westminster Bank</td>
<td> Mortgage term plus 30 years.<br /><br />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.
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<td>Santander</td>
<td> You must report the unexpired lease term to us and await our instructions if: <br />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<br />2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or<br />3. no valuation report is provided<br />However, we will not accept a lease where on expiry of the mortgage:<br />(i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or<br />(ii) less than 30 years remain and the loan is repaid on a capital and interest basis<br /><br />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.
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<td>The Mortgage Works</td>
<td> Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term. <br />Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:<br /><br />Second hand property:<br />- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years <br />- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported<br />- For equity share applications - advise us if the actual lease term is different than reported on the offer<br /><br />New build property:<br />- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)<br />- For equity share applications - always advise us if the actual lease term is different than reported on the offer<br /><br />Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.<br /><br />SECOND HAND PROPERTIES<br /><br />Unacceptable - advise Issuing Office (Will be declined):<br />- Unexpired lease term less than 70 years<br />- Less than 30 years remaining at the end of the mortgage term<br />- Ground Rent greater than 0.5% of the property value<br />- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more<br />- Ground Rent is compounded RPI<br />- Ground Rent review period less than or equal to 5 years<br /><br />Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):<br />- Unexpired lease term is 70 to 85 years<br />- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value<br />- Ground Rent escalation is linked to any indices greater than RPI<br />- Ground Rent escalation is linked to the value of the building*<br />- Ground Rent review period is greater than 5 and less than 10 years<br />- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc<br />- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)<br />- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)<br />- Anything that appears onerous, unusual or out of the ordinary<br /><br />Acceptable (no requirement to advise Issuing Office): <br />- Unexpired lease term greater than 85 years<br />- Ground Rent less than or equal to 0.1% of the property value<br />- Ground Rent review period greater than or equal to 10 years<br />- Ground Rent escalation less than or equal to RPI<br /><br />NEW BUILD PROPERTIES (includes office conversions)<br /><br />Unacceptable - advise Issuing Office (will be declined):<br />- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house <br />- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis<br />- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology<br /><br />Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):<br />- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc<br />- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)<br />- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)<br />- Anything else appears onerous, unusual or out of the ordinary<br /><br />Acceptable (no requirement to advise Issuing Office):<br />- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house <br />- A lease subject to a peppercorn ground rent (annual rent) charges <br /><br />For the avoidance of doubt, any new build properties completed but not sold pre 30 June 2022 will only be acceptable if the lease conforms to the above guidance <br /><br />* Where the Ground Rent escalation is linked to the value of the building, please provide the following:<br />- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property? <br />- The current valuation and Ground Rent for each unit<br />- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?<br />- What is the right of appeal? And is this a documented process within the lease?<br />- Who bears the cost of the valuation (and appeal) process?<br />- Confirmation the review period is not less than twenty years<br /><br />LEASE EXTENSIONS<br /><br />We require all lease extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where you become aware that it does not meet these requirements, please refer to the Issuing Office <br /><br />Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
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<td>Virgin</td>
<td> 85 years at the time of completion. If it's less, we require it to be extended on or before completion.
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<h4> Get in touch with one of our Hungerford lease extension solicitors or enfranchisement solicitors
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Lease extensions in Hungerford can be a difficult process. We recommend you procure professional help from a conveyancer and surveyor with experience in this area.
<p>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 procuring Hungerford lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
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Hungerford Lease Extension Example Cases:
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<h5> Alfie, Hungerford, Berkshire</h5>
<p> Last Autumn Alfie, started to get close to the eighty-year mark with the lease on his garden flat in Hungerford. In buying his property two decades ago, the length of the lease was of minimal bearing. Thankfully, he noticed he would soon be paying an escalated premium for Extending the lease. Alfie extended the lease at the eleventh hour in March. Alfie and the freeholder eventually agreed on sum of £5,500 . If he not met the deadline, the amount would have increased by at least £975.
<h5>Hungerford case:</h5>
<p> Mrs G Stewart moved into a basement apartment in Hungerford in March 2010. We are asked if we could approximate the premium would likely be to extend the lease by a further 90 years. Identical properties in Hungerford with a long lease were valued about £290,000. The average amount of ground rent was £45 collected per annum. The lease ended on 15 April 2098. Given that there were 72 years unexpired we estimated the compensation to the landlord for the lease extension to be between £11,400 and £13,200 plus professional charges.
<h5>Hungerford case:</h5>
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Last Spring we were contacted by Dr B Flores , who
acquired a one bedroom flat in Hungerford in January 2007. The question was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by ninety years. Comparable properties in Hungerford with a long lease were valued around £233,200. The mid-range ground rent payable was £60 collected every twelve months. The lease terminated in 2087. Considering the 61 years outstanding we calculated the premium to the freeholder for the lease extension to be between £22,800 and £26,400 exclusive of legals.
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