As the the remaining lease term of a Tetbury domestic lease diminished so does its value and therefore the value of your property. Where the lease has, in excess of one hundred years remaining then this decrease may be of little impact nevertheless there will become a point in time when a lease has fewer than eighty years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. Many flat owners in Tetbury will meet the qualifying criteria; that being said a lawyer can advise if you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold properties in Tetbury with over 100 years remaining 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 situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you enhanced control over the value of your Tetbury leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Muhammad, came critically close to the 80-year threshold with the lease on his leasehold flat in Tetbury. Having purchased his home two decades ago, the lease term was of little significance. Thankfully, he noticed he needed to take steps soon on a lease extension. Muhammad extended the lease just under the wire in March. Muhammad and the landlord ultimately agreed on a premium of £5,000 . If he failed to meet the deadline, the price would have increased by at least £1,100.
In 2010 we were e-mailed by Mr and Mrs. C Anderson who, having owned a purpose-built apartment in Tetbury in November 1996. The dilemma was if we could approximate the price would likely be for a 90 year lease extension. Comparable premises in Tetbury with an extended lease were in the region of £220,400. The average ground rent payable was £45 billed every twelve months. The lease finished on 14 January 2089. Given that there were 64 years remaining we approximated the compensation to the freeholder for the lease extension to be between £16,200 and £18,600 plus expenses.
Mrs F Norbert took over the lease of a newly refurbished apartment in Tetbury in February 2007. We are asked if we could estimate the price would be for a 90 year extension to my lease. Comparable premises in Tetbury with an extended lease were worth £270,000. The mid-range ground rent payable was £55 collected per annum. The lease concluded on 18 November 2100. Given that there were 75 years remaining we calculated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 not including professional charges.