The basic rule is, all other factors being equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Mancot may extend the lease for a further ninety years under the 1993 Leasehold Reform Act. Please think carefully before delaying your Mancot lease extension. Putting off that expense today simply increases the amount you will ultimately be required to pay for a lease extension.
Leasehold properties in Mancot with more than one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges merit 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 are not acceptable. 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
Engaging our service gives you better control over the value of your Mancot leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to protracted negotiations with the landlord of her basement flat in Mancot, Emma initiated the lease extension process just as the lease was approaching the critical eighty-year deadline. The transaction was finalised in January 2008. The freeholder’s charges were restricted to below 650 GBP.
Last Christmas we were approach by Mr and Mrs. N Thompson , who purchased a ground floor flat in Mancot in August 2009. We are asked if we could shed any light on how much (approximately) price could be for a ninety year extension to my lease. Comparative homes in Mancot with an extended lease were worth £280,000. The average ground rent payable was £45 billed yearly. The lease came to a finish in 2095. Taking into account 69 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of fees.
Last month we were called by Mr Luca Miller , who moved into a garden flat in Mancot in August 2003. The question was if we could shed any light on how much (roughly) price could be for a ninety year lease extension. Similar residencies in Mancot with an extended lease were valued around £216,000. The average ground rent payable was £60 billed yearly. The lease ran out in 2084. Having 58 years remaining we calculated the premium to the landlord for the lease extension to be between £28,500 and £33,000 exclusive of professional charges.