With a residential leasehold premises in Prestwich, you are actually purchasing an entitlement to live in a property for a set period of time. These days flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease gets disproportionately greater particularly once there are fewer than 80 years remaining. Leasehold owners in Prestwich with a lease nearing 81 years left should seriously consider extending it as soon as possible. Once the lease term has less than eighty years remaining, under the current Act the landlord is entitled to calculate and levy a larger premium, based on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold residencies in Prestwich with in excess of one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges merit 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
Using our service gives you better control over the value of your Prestwich leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jasper was the the leasehold owner of a 2 bedroom apartment in Prestwich on the market with a lease of a little over 72 years left. Jasper on an informal basis contacted his landlord being a well known local-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Jasper to exercise his statutory right. Jasper procured expert legal guidance and secured an acceptable deal informally and sell the flat.
Last November we were called by Dr K Simon , who completed a studio flat in Prestwich in April 1996. We are asked if we could estimate the price would likely be for a ninety year lease extension. Similar residencies in Prestwich with 100 year plus lease were in the region of £300,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease came to a finish in 2101. Considering the 76 years unexpired we approximated the premium to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of legals.
Last Christmas we were called by Ms W Michel , who acquired a recently refurbished flat in Prestwich in November 2001. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by ninety years. Comparable flats in Prestwich with 100 year plus lease were valued about £257,800. The mid-range amount of ground rent was £65 collected every twelve months. The lease expiry date was in 2090. Considering the 65 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £18,100 and £20,800 not including fees.