Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a set period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Tilbury. Clearly, the term of lease left shortens over time. This is often ignored and only raises itself as an issue when the property needs to be disposed of or refinanced. The shorter the lease the lower the value of the property and the more expensive it will be to obtain a lease extension. Qualifying leaseholders in Tilbury have the right to extend the lease for an additional 90 years in accordance with legislation. Do give careful consideration before delaying your Tilbury lease extension. Holding off that expense now simply increases the price you will ultimately incur to extend your lease
Leasehold premises in Tilbury with over one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Tilbury,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Tilbury valuers.
Last October Ryan, started to get close to the 80-year mark with the lease on his studio flat in Tilbury. Having bought his home two decades ago, the unexpired term was of minimal interest. As luck would have it, he recognised he needed to take action soon on Extending the lease. Ryan arranged for a lease extension just in the nick of time in May. Ryan and the freeholder in the end settled on an amount of £5,000 . If the lease had slipped below 80 years, the sum would have gone up by at least £925.
Last Winter we were e-mailed by Mr and Mrs. N Ali , who was assigned a lease of a recently refurbished flat in Tilbury in February 1999. The question was if we could approximate the price could be to extend the lease by ninety years. Comparable residencies in Tilbury with 100 year plus lease were in the region of £205,000. The average ground rent payable was £50 collected monthly. The lease ran out in 2104. Taking into account 79 years unexpired we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 not including legals.
Mr and Mrs. L González bought a first floor apartment in Tilbury in September 2010. The dilemma was if we could approximate the price would likely be for a 90 year extension to my lease. Similar homes in Tilbury with an extended lease were in the region of £275,000. The mid-range amount of ground rent was £65 collected every twelve months. The lease finished in 2093. Considering the 68 years unexpired we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of costs.