For anyone whose Liskeard flat is held on a long lease, the message is clear – if nothing is done, your property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to procure a lease extension.
Leasehold properties in Liskeard with more than one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and estate charges justify 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. |
| 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; |
| Chelsea Building Society | 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Engaging our service will provide you increased control over the value of your Liskeard leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Jayden, started to get close to the eighty-year mark with the lease on his purpose- built apartment in Liskeard. In buying his home two decades ago, the unexpired term was of no relevance. Thankfully, it dawned on him that he would imminently be paying way over the odds for a lease extension. Jayden was able to extend his lease just ahead of time last April. Jayden and the landlord eventually settled on a premium of £5,500 . If he not met the deadline, the amount would have increased by a minimum £1,075.
Last Winter we were phoned by Mr Y Jackson , who owned a purpose-built flat in Liskeard in June 2005. The question was if we could estimate the price would be to prolong the lease by 90 years. Similar homes in Liskeard with a long lease were in the region of £181,200. The mid-range ground rent payable was £65 collected every twelve months. The lease finished in 2081. Given that there were 56 years outstanding we approximated the premium to the freeholder to extend the lease to be between £29,500 and £34,000 not including costs.
Mr and Mrs. C Alexander acquired a ground floor apartment in Liskeard in July 2004. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Identical residencies in Liskeard with a long lease were in the region of £242,600. The mid-range ground rent payable was £45 invoiced monthly. The lease expiry date was in 2092. Having 67 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £11,400 and £13,200 plus professional charges.