Owning a flat usually means owning a lease of the property, which has a finite term of years. This lease will ordinarily be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Seven Kings. Clearly, the length of lease remaining shortens as time goes by. This may slip by relatively unnoticed when the flat or house has to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible long lease owners in Seven Kings have the legal entitlement to extend the lease for a further 90 years under legislation. Please give due attention before delaying your Seven Kings lease extension. Holding off that expense now only increases the price you will eventually have to pay to extend your lease
Leasehold residencies in Seven Kings with over one hundred years remaining on the lease are sometimes regarded as a ‘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 freehold unless savings on ground rent and maintenance 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you enhanced control over the value of your Seven Kings 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.
In the wake of eight months of protracted discussions with the landlord of her purpose-built flat in Seven Kings, Zoe started the lease extension process as the 80 year deadline was quickly approaching. The transaction was finalised in June 2007. The landlord’s fees were restricted to less than 550 pounds.
In 2014 we were called by Mr and Mrs. B Jones who, having was assigned a lease of a basement flat in Seven Kings in February 2007. We are asked if we could estimate the price would likely be for a ninety year extension to my lease. Comparative flats in Seven Kings with an extended lease were worth £280,000. The mid-range amount of ground rent was £55 invoiced per annum. The lease terminated on 9 August 2102. Considering the 77 years left we estimated the premium to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of expenses.
An example of a Lease Extension matter before the tribunal for a Seven Kings premises is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case was in relation to 1 flat. The unexpired term as at the valuation date was 61.36 years.