As the length of the unexpired term of a Pitsea domestic lease lessens so does its value and therefore the value of your property. If the residual term has, more than 125 years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has fewer than 80 years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main rational as to why you should extend the lease without delay. The majority of flat owners in Pitsea will meet the qualifying criteria; nevertheless a conveyancing solicitor can advise whether you are eligible to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold properties in Pitsea with more than 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | 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. |
| 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. |
The conveyancers that we work with undertake Pitsea 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 conveyancing solicitor we work with provide it.
Oliver owned a conversion apartment in Pitsea being marketed with a lease of a little over sixty years remaining. Oliver informally spoke with his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Oliver to exercise his statutory right. Oliver obtained expert advice and was able to make a more informed decision and handle with the matter and sell the flat.
In 2012 we were e-mailed by Mr and Mrs. I White who, having was assigned a lease of a one bedroom apartment in Pitsea in August 2010. We are asked if we could estimate the premium would be for a ninety year lease extension. Similar flats in Pitsea with an extended lease were valued around £275,000. The mid-range ground rent payable was £65 invoiced quarterly. The lease expired on 27 February 2094. Having 68 years remaining we approximated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 plus professional charges.
In 2014 we were phoned by Dr B Clark who, having was assigned a lease of a purpose-built flat in Pitsea in August 2000. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Comparative properties in Pitsea with 100 year plus lease were valued around £208,600. The mid-range ground rent payable was £60 collected every twelve months. The lease terminated on 11 October 2083. Having 57 years remaining we calculated the premium to the landlord for the lease extension to be between £30,400 and £35,200 exclusive of fees.