With a long leasehold premises in Rawcliffe, you are actually purchasing a right to reside in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive especially when there are less than 80 years remaining. Residents in Rawcliffe with a lease approaching 81 years remaining should seriously consider extending it without delay. When the lease term has below eighty years outstanding, under the relevant statute the freeholder is entitled to calculate and levy a larger premium, based on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold residencies in Rawcliffe with in excess of one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate 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. |
| 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. |
| 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 Rawcliffe leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last October Leo, started to get near to the 80-year threshold with the lease on his studio apartment in Rawcliffe. In buying his flat twenty years ago, the lease term was of no significance. As luck would have it, he recognised he would imminently be paying way over the odds for Extending the lease. Leo was able to extend his lease at the eleventh hour in July. Leo and the freeholder eventually settled on an amount of £6,000 . If the lease had dropped below 80 years, the amount would have increased by at least £1,025.
Ms Hannah David acquired a ground floor apartment in Rawcliffe in August 1997. The dilemma was if we could estimate the price would be for a 90 year extension to my lease. Similar homes in Rawcliffe with an extended lease were in the region of £208,600. The mid-range amount of ground rent was £60 invoiced quarterly. The lease terminated on 5 April 2082. Considering the 57 years remaining we approximated the compensation to the landlord for the lease extension to be between £30,400 and £35,200 not including expenses.
In 2009 we were called by Mr and Mrs. V Flores who, having bought a studio flat in Rawcliffe in April 1996. We are asked if we could approximate the premium would be for a 90 year lease extension. Comparable flats in Rawcliffe with a long lease were in the region of £200,000. The average amount of ground rent was £50 invoiced yearly. The lease ended on 25 August 2102. Given that there were 77 years unexpired we approximated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 plus costs.