For those whose Penge home is held on a long lease, our message is clear – if nothing is done, your property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more it will cost to extend the lease.
Leasehold residencies in Penge with more than one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold 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 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service will provide you increased control over the value of your Penge leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Trailing lengthy discussions with the landlord of her ground floor apartment in Penge, Jennifer commenced the lease extension process just as her lease was approaching the critical eighty-year mark. The lease extension was concluded in February 2012. The freeholder’s costs were restricted to a tad over 550 GBP.
In 2013 we were approached by Mr Jasper Gómez who, having owned a purpose-built apartment in Penge in November 1997. We are asked if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar premises in Penge with an extended lease were in the region of £300,000. The mid-range amount of ground rent was £50 billed quarterly. The lease ended in 2101. Having 76 years remaining we approximated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of professional charges.
An example of a Lease Extension decision for a Penge property is Flats 5, 9, 38 & 40 Blakewood Court Anerley Park in January 2012. the tribunal held that the premiums payable for the new lease sare: FLAT 5:- £7,130 FLAT 9:- £7,860 FLAT 38:- £15,867 FLAT 40: £14,834 This case related to 4 flats.