On the balance of probabilities if you own a flat in St Neots you actually own a long leasehold interest over your property
Leasehold properties in St Neots with more than 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by buying the freehold 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. |
| 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; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire Building Society | 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. |
The conveyancing solicitors that we work with handle St Neots 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 conveyancing solicitor we work with provide it.
Noah owned a studio apartment in St Neots being sold with a lease of a little over 72 years left. Noah informally contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to an increased rent to £100 annually. No ground rent would be due on a lease extension were Noah to invoke his statutory right. Noah procured expert advice and secured an acceptable resolution without resorting to tribunal and sell the property.
In 2013 we were approached by Ms Rachel Robinson who, having bought a one bedroom flat in St Neots in August 2012. The question was if we could approximate the price would likely be to extend the lease by a further 90 years. Comparable homes in St Neots with a long lease were valued around £183,600. The average amount of ground rent was £65 invoiced quarterly. The lease termination date was in 2083. Considering the 57 years left we approximated the premium to the landlord for the lease extension to be between £28,500 and £33,000 not including expenses.
Mr and Mrs. G André acquired a recently refurbished flat in St Neots in September 2001. The dilemma was if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Comparable residencies in St Neots with an extended lease were worth £245,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease lapsed on 20 February 2094. Having 68 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 plus legals.