The basic rule is, all other things holding equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Lake District can extend the lease for a further 90 years in accordance with statute. Please give careful consideration before delaying your Lake District lease extension. Shelving the costs now simply increases the amount you will ultimately be required to pay for a lease extension.
Leasehold residencies in Lake District with in excess of 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Retaining our service will provide you better control over the value of your Lake District leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of unsuccessful negotiations with the landlord of her one bedroom flat in Lake District, Laura commenced the lease extension process as the 80 year threshold was swiftly nearing. The transaction completed in September 2014. The freeholder’s charges were kept to an absolute minimum.
Mr T Brown bought a basement apartment in Lake District in February 2004. The dilemma was if we could approximate the price would likely be to prolong the lease by 90 years. Comparative residencies in Lake District with an extended lease were in the region of £267,600. The average ground rent payable was £65 billed yearly. The lease elapsed on 19 July 2091. Given that there were 67 years unexpired we calculated the premium to the landlord to extend the lease to be between £14,300 and £16,400 exclusive of fees.
Dr George Harris took over the lease of a studio flat in Lake District in February 2004. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Comparative flats in Lake District with an extended lease were worth £201,200. The mid-range amount of ground rent was £55 collected annually. The lease expired in 2080. Considering the 56 years outstanding we calculated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 plus fees.