Millom residential property owned on a long lease is a wasting asset because a leaseholder only owns the property for a period of years.
Leasehold premises in Millom with in excess of one hundred years left 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 premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Millom 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.
18 months ago Jasper, came dangerously near to the eighty-year mark with the lease on his one bedroom apartment in Millom. In buying his home 18 years previously, the lease term was of minimal concern. by good luck, he became aware that he needed to take action soon on Extending the lease. Jasper was able to extend his lease just in the nick of time in July. Jasper and the freeholder eventually agreed on a premium of £6,000 . If he not met the deadline, the price would have become more costly by a minimum £950.
Last Autumn we were called by Mrs A Harris , who purchased a purpose-built apartment in Millom in November 2009. The dilemma was if we could estimate the price would be for a ninety year extension to my lease. Comparable residencies in Millom with 100 year plus lease were valued around £280,000. The average ground rent payable was £55 billed monthly. The lease concluded in 2102. Considering the 77 years as a residual term we approximated the premium to the landlord to extend the lease to be between £13,300 and £15,400 plus expenses.
Last Christmas we were contacted by Mr and Mrs. V Lambert , who owned a garden flat in Millom in June 1996. The question was if we could shed any light on how much (approximately) price could be for a ninety year lease extension. Comparative flats in Millom with a long lease were valued about £183,600. The average ground rent payable was £65 collected annually. The lease finished in 2082. Taking into account 57 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £28,500 and £33,000 plus professional charges.