With a long leasehold premises in Swiss Cottage, you are actually purchasing an entitlement to live in a property for a set period of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than 80 years remaining. Residents in Swiss Cottage with a lease drawing near to 81 years unexpired should seriously consider extending it without delay. When a lease has under 80 years remaining, under the relevant statute the freeholder is entitled to calculate and charge a larger premium, based on a technical multiplication, known as “marriage value” which is due.
Leasehold premises in Swiss Cottage with in excess of one hundred years unexpired on the lease are often 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 to be gained by purchasing 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. |
Chelsea 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. |
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. |
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. |
Retaining our service gives you increased control over the value of your Swiss Cottage leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Twenty four months ago Riley, came perilously near to the eighty-year threshold with the lease on his basement flat in Swiss Cottage. In buying his property two decades ago, the lease term was of little significance. Luckily, he realised he needed to take action soon on Extending the lease. Riley arranged for a lease extension just ahead of time in April. Riley and the freeholder eventually settled on an amount of £6,000 . If he failed to meet the deadline, the amount would have become more costly by a minimum £950.
Last Christmas we were e-mailed by Mr and Mrs. O Cook , who moved into a newly refurbished apartment in Swiss Cottage in July 2004. The dilemma was if we could estimate the price could be for a ninety year extension to my lease. Comparative homes in Swiss Cottage with a long lease were worth £245,000. The average amount of ground rent was £50 collected per annum. The lease ran out on 8 January 2092. Considering the 68 years outstanding we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of legals.
An example of a Lease Extension matter before the tribunal for a Swiss Cottage property is Raised Ground Floor Flat 20 Fitzjohns Avenue in July 2014. the Tribunal decided that the premiums to be paid for new leases in respect of the Raised Ground Floor Flat and the First Floor Flat were to be calculated as: Raised Ground Floor: £765,175.14 First Floor: £601,617.77 This case affected 2 flats. The remaining number of years on the lease was 16.83 and 16.43.