There is no doubt about it a leasehold property in Penzance is a wasting asset as a result of the diminishing lease term. Where the residual term has, more than one hundred years to run then this decrease may be fractional however there will become a point in time when a lease has under than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary reason why you should consider extending sooner than later. The majority of flat owners in Penzance will meet the qualifying criteria; nevertheless a conveyancer will be able to confirm whether you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold premises in Penzance with in excess of one hundred years unexpired on the lease are sometimes 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 to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges merit 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Lease extensions in Penzance can be a difficult process. We recommend you get professional help from a lawyer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Penzance lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of 9 months of lengthy negotiations with the freeholder of her garden flat in Penzance, Holly initiated the lease extension process as the eighty year deadline was rapidly nearing. The legal work was concluded in June 2008. The freeholder’s costs were kept to an absolute minimum.
In 2010 we were called by Dr W Laurent who, having completed a ground floor apartment in Penzance in January 2010. We are asked if we could approximate the premium would likely be to prolong the lease by a further 90 years. Comparable homes in Penzance with a long lease were in the region of £270,000. The mid-range amount of ground rent was £55 collected every twelve months. The lease came to a finish in 2101. Having 75 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including costs.
Last Summer we were phoned by Mr and Mrs. R Phillips , who bought a first floor flat in Penzance in October 2005. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Similar premises in Penzance with 100 year plus lease were valued about £173,800. The average amount of ground rent was £65 invoiced yearly. The lease came to a finish on 5 November 2081. Given that there were 55 years left we approximated the compensation to the freeholder to extend the lease to be between £31,400 and £36,200 not including professional charges.