South Woodham Ferrers leases on domestic properties are gradually losing value. Where your lease has in the region of ninety years remaining, you should start thinking about a lease extension. If lease term dips under eighty years, you will then have to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in South Woodham Ferrers will usually be legally entitled to a lease extension; however a solicitor should be able check if you qualify. In some cases you may not qualify. There are also strict timetables and formalities to follow once the process has started so it’s sensible to be guided by a lawyer during the process.
It is generally accepted that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with undertake South Woodham Ferrers 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.
Last Spring Ali, came very near to the 80-year mark with the lease on his leasehold flat in South Woodham Ferrers. Having purchased his property two decades ago, the length of the lease was of little bearing. Thankfully, he recognised he needed to take action soon on Extending the lease. Ali extended the lease just ahead of time in September. Ali and the landlord who owned the flat above eventually agreed on an amount of £5,500 . If the lease had descended to less than 80 years, the sum would have escalated by at least £1,000.
Mr and Mrs. G Michel acquired a purpose-built apartment in South Woodham Ferrers in November 2012. The question was if we could estimate the price could be for a 90 year lease extension. Comparable flats in South Woodham Ferrers with an extended lease were valued about £280,000. The average ground rent payable was £55 billed yearly. The lease end date was in 2104. Having 78 years remaining we estimated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus expenses.
Last month we were phoned by Mr John Bell , who completed a ground floor flat in South Woodham Ferrers in June 2008. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year lease extension. Comparative premises in South Woodham Ferrers with 100 year plus lease were valued about £191,000. The average ground rent payable was £65 billed annually. The lease expired in 2084. Taking into account 58 years left we calculated the compensation to the freeholder for the lease extension to be between £23,800 and £27,400 not including professional charges.