Tolworth leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now which entitles qualifying Tolworth residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Tolworth you should check if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under eighty years, the cost of any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold properties in Tolworth with over 100 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 property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 procure Tolworth 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 conveyancer we work with provide it.
Subsequent to protracted discussions with the landlord of her leasehold flat in Tolworth, Rachel commenced the lease extension process just as the lease was coming close to the crucial eighty-year threshold. The transaction was concluded in October 2005. The landlord’s charges were negotiated to under 500 GBP.
In 2011 we were approached by Mr and Mrs. K Fournier who, having purchased a newly refurbished flat in Tolworth in February 2004. We are asked if we could approximate the premium would likely be to extend the lease by a further 90 years. Identical homes in Tolworth with 100 year plus lease were worth £198,800. The average amount of ground rent was £55 collected quarterly. The lease terminated on 19 January 2081. Having 55 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 not including professional charges.
An example of a Lease Extension decision for a Tolworth flat is Flat D 15 Claremont Gardens in September 2013. TheTribunal determined in accordance with section48 and Schedule13 of the Leasehold Reform,Housing and Urban Development Act 1993 that the premium for the extended lease should be fourteen thousand one hundred and eighty seven pounds (£14,187.00) This case related to 1 flat.