The nearer a residential lease in Meliden nears to zero years unexpired, the more it reduces the value of the property. If the lease has, in excess of one hundred years to run then this decrease may be fractional however there will become a point in time when a lease has fewer than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the primary logic behind why you should consider extending without delay. Most flat owners in Meliden will meet the qualifying criteria; however a lawyer can advise if you qualify for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Meliden with in excess of 100 years outstanding 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 property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Birmingham Midshires | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Meliden lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
After unsuccessful negotiations with the freeholder of her ground floor flat in Meliden, Georgina started the lease extension process just as her lease was coming close to the crucial 80-year deadline. The transaction was finalised in October 2005. The landlord’s fees were restricted to about 650 GBP.
In 2009 we were phoned by Mrs A Watson who, having owned a studio apartment in Meliden in May 2001. The dilemma was if we could approximate the price could be to prolong the lease by an additional years. Identical residencies in Meliden with 100 year plus lease were in the region of £208,600. The mid-range ground rent payable was £60 collected yearly. The lease terminated in 2082. Taking into account 57 years unexpired we estimated the premium to the freeholder to extend the lease to be between £30,400 and £35,200 not including legals.
In 2010 we were phoned by Mr and Mrs. T Torres who, having bought a garden apartment in Meliden in November 2002. The dilemma was if we could approximate the price would be to prolong the lease by 90 years. Comparative premises in Meliden with an extended lease were worth £200,000. The mid-range amount of ground rent was £50 collected monthly. The lease elapsed on 3 January 2102. Taking into account 77 years remaining we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 not including costs.