Sale leases on domestic deteriorating in value. if your lease has about ninety years remaining, you should start considering the need for a lease extension. It is important to recognise that it is that it is desirable for the lease extension to take place before the term of the existing lease dips under 80 years - otherwise a higher premium will be due. Leasehold owners in Sale will mostly be legally entitled to a lease extension; however it’s a good idea to check with a lawyer to confirm if you qualify. In some circumstances you may not be entitled. There are prescribed deadlines and steps to follow once the process has commenced so it’s sensible to be guided by a conveyancing solicitor during the process.
Leasehold properties in Sale with in excess of one hundred years unexpired on the lease are often referred to as ‘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 purchasing 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. |
| 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. |
| Halifax | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you better control over the value of your Sale leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last Spring Daniel, came seriously near to the 80-year mark with the lease on his garden flat in Sale. In buying his home two decades ago, the length of the lease was of little significance. Fortunately, he recognised he would imminently be paying an escalated premium for a lease extension. Daniel extended the lease at the eleventh hour in July. Daniel and the landlord who owned the flat above eventually settled on the final figure of £5,000 . If he had missed the deadline, the sum would have escalated by a minimum £850.
Mr and Mrs. U Ramírez bought a garden apartment in Sale in March 1995. The question was if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Similar homes in Sale with an extended lease were valued around £261,600. The average ground rent payable was £60 invoiced quarterly. The lease came to a finish on 12 February 2077. Considering the 52 years unexpired we estimated the compensation to the landlord for the lease extension to be within £39,000 and £45,000 exclusive of legals.
Ms V Stewart purchased a one bedroom apartment in Sale in January 2004. We are asked if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Comparable premises in Sale with 100 year plus lease were in the region of £218,000. The mid-range amount of ground rent was £45 billed every twelve months. The lease end date was on 12 July 2088. Taking into account 63 years left we estimated the premium to the landlord for the lease extension to be between £17,100 and £19,800 plus costs.