Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will ordinarily be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Okehampton. Clearly, the length of lease remaining reduces over time. This is often ignored and only raises itself as an issue when the flat or house needs to be disposed of or refinanced. The fewer the years remaining the lower the value of the property and the more it will cost to extend the lease. Qualifying long lease owners in Okehampton have the legal entitlement to extend the lease for a further ninety years under statute. Please give careful consideration before delaying your Okehampton lease extension. Holding off the cost now only increases the price you will ultimately incur for a lease extension
Leasehold properties in Okehampton with over one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value 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 warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 Okehampton leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last Winter Ethan, started to get near to the 80-year threshold with the lease on his purpose- built flat in Okehampton. Having purchased his property 18 years previously, the unexpired term was of no bearing. Luckily, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Ethan arranged for a lease extension just under the wire last March. Ethan and the freeholder via the managing agents ultimately agreed on a premium of £5,000 . If he failed to meet the deadline, the amount would have become more exhorbitant by a minimum £925.
In 2009 we were e-mailed by Mr and Mrs. I Flores who, having was assigned a lease of a one bedroom flat in Okehampton in February 1997. The dilemma was if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Identical residencies in Okehampton with 100 year plus lease were worth £260,000. The average ground rent payable was £50 invoiced every twelve months. The lease ran out in 2097. Considering the 71 years outstanding we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus legals.
Dr C Murphy acquired a recently refurbished flat in Okehampton in September 1997. The question was if we could shed any light on how much (roughly) price could be to extend the lease by ninety years. Identical properties in Okehampton with an extended lease were in the region of £254,200. The average amount of ground rent was £60 collected quarterly. The lease ran out in 2077. Considering the 51 years left we calculated the premium to the landlord to extend the lease to be within £43,700 and £50,600 not including expenses.