Looe leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Looe tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Looe you must check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
Leasehold premises in Looe with more than 100 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 purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | 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. |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Looe can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer with experience in lease extensions.
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 dealing with Looe lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Stanley, started to get close to the 80-year threshold with the lease on his studio flat in Looe. In buying his home two decades ago, the length of the lease was of minimal relevance. Thankfully, it dawned on him that he would imminently be paying an escalated premium for Extending the lease. Stanley extended the lease just ahead of time last April. Stanley and the freeholder eventually agreed on an amount of £5,000 . If he had missed the deadline, the figure would have gone up by a minimum £1,075.
Mr and Mrs. M Alexander took over the lease of a garden flat in Looe in June 2004. We are asked if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparative flats in Looe with a long lease were worth £206,200. The average amount of ground rent was £60 billed annually. The lease termination date was on 9 July 2081. Considering the 56 years left we calculated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 plus costs.
In 2009 we were called by Mr and Mrs. R Dupont who, having was assigned a lease of a one bedroom flat in Looe in March 2001. The dilemma was if we could estimate the premium could be for a ninety year extension to my lease. Comparable residencies in Looe with 100 year plus lease were worth £300,000. The average ground rent payable was £50 collected annually. The lease finished on 16 November 2101. Taking into account 76 years left we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 not including costs.