With a long leasehold premises in Somersham, 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. Even though this may appear like a long period of time, you may think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly notably once there are fewer than eighty years remaining. Residents in Somersham with a lease approaching 81 years unexpired should seriously consider extending it sooner as opposed to later. Once a lease has below eighty years remaining, under the relevant statute the freeholder is entitled to calculate and levy a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold premises in Somersham with more than 100 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 home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Somersham 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 conveyancer we work with provide it.
Harrison was the the leasehold proprietor of a studio flat in Somersham on the market with a lease of fraction over sixty years unexpired. Harrison on an informal basis approached his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Harrison to invoke his statutory right. Harrison obtained expert advice and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Mr and Mrs. T Wright took over the lease of a first floor apartment in Somersham in June 2001. The dilemma was if we could estimate the price would likely be to prolong the lease by a further 90 years. Comparative homes in Somersham with a long lease were in the region of £206,200. The mid-range ground rent payable was £60 billed yearly. The lease expired in 2082. Taking into account 56 years outstanding we calculated the premium to the landlord for the lease extension to be within £32,300 and £37,400 plus costs.
Last Spring we were approach by Mr and Mrs. H Ali , who owned a one bedroom apartment in Somersham in September 1995. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by 90 years. Comparative properties in Somersham with an extended lease were in the region of £300,000. The average amount of ground rent was £50 collected annually. The lease lapsed on 2 September 2102. Having 76 years left we estimated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of fees.