When it comes to residential leasehold property in Shenfield, you effectively rent it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are less than 80 years remaining. Residents in Shenfield with a lease drawing near to 81 years left should seriously consider extending it as soon as possible. Once a lease has less than 80 years left, under the current legislation the freeholder can calculate and charge a larger amount, assessed on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold residencies in Shenfield with in excess of one hundred years outstanding 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 circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
Lender | Requirement |
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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. |
Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
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. |
Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle Shenfield 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 lawyer we work with provide it.
William owned a high value apartment in Shenfield being sold with a lease of a little over sixty years remaining. William on an informal basis spoke with his freeholder being a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £200 yearly. Ordinarily, ground rent would not be due on a lease extension were William to exercise his statutory right. William procured expert advice and secured satisfactory deal without going to tribunal and sell the property.
Mr and Mrs. D Khan acquired a basement flat in Shenfield in November 2008. The question was if we could estimate the premium would likely be to extend the lease by an additional years. Similar flats in Shenfield with an extended lease were in the region of £270,000. The average amount of ground rent was £55 invoiced monthly. The lease came to a finish on 17 January 2099. Considering the 74 years left we calculated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 plus expenses.
In 2009 we were approached by Mr and Mrs. L Díaz who, having owned a basement apartment in Shenfield in March 2012. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Similar properties in Shenfield with 100 year plus lease were in the region of £166,400. The mid-range ground rent payable was £60 invoiced monthly. The lease elapsed on 10 August 2079. Having 54 years left we approximated the compensation to the freeholder for the lease extension to be within £32,300 and £37,400 not including professional charges.