Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will normally be granted for a prescribed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Tibshelf. Clearly, the length of lease left shortens as time goes by. This may slip by relatively unnoticed when the residence needs to be sold or re-mortgaged. The fewer the years remaining the lower the value of the property and the more expensive it will be to obtain a lease extension. Eligible leaseholders in Tibshelf have the right to extend the lease for an additional 90 years under legislation. Do give careful attention before putting off your Tibshelf lease extension. Putting off that expense now only increases the price you will eventually have to pay for a lease extension
Leasehold premises in Tibshelf with over one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and estate 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Tibshelf,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Tibshelf valuers.
Elijah was the the leasehold proprietor of a conversion apartment in Tibshelf being sold with a lease of fraction over 59 years remaining. Elijah on an informal basis approached his landlord a well known local-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Elijah to exercise his statutory right. Elijah obtained expert advice and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
Mr and Mrs. A Murphy acquired a purpose-built apartment in Tibshelf in October 2000. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Comparable homes in Tibshelf with an extended lease were worth £210,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease concluded in 2105. Taking into account 80 years remaining we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including legals.
Mr and Mrs. B Hernández owned a recently refurbished flat in Tibshelf in November 1996. The dilemma was if we could approximate the premium could be to extend the lease by ninety years. Identical premises in Tibshelf with 100 year plus lease were valued around £280,000. The average amount of ground rent was £45 billed yearly. The lease came to a finish in 2094. Having 69 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 plus fees.