The rule of thumb is, all other factors being equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Verwood may extend the lease for an additional 90 years under the 1993 Leasehold Reform Act. Do think carefully before delaying your Verwood lease extension. Postponing the costs now simply escalates the premium you will ultimately be required to pay to extend the lease.
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service will provide you enhanced control over the value of your Verwood leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last October Alfie, came critically close to the eighty-year mark with the lease on his garden apartment in Verwood. In buying his property 18 years ago, the lease term was of minimal interest. Fortunately, he realised he would soon be paying way over the odds for Extending the lease. Alfie was able to extend his lease at the eleventh hour in April. Alfie and the landlord in the end settled on the final figure of £5,500 . If the lease had slipped to less than 80 years, the sum would have gone up by a minimum £1,000.
Last Winter we were approach by Dr Jonathan Martin , who owned a one bedroom apartment in Verwood in March 2001. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by 90 years. Similar premises in Verwood with a long lease were in the region of £176,200. The mid-range amount of ground rent was £65 collected monthly. The lease lapsed on 25 January 2082. Given that there were 56 years outstanding we estimated the premium to the freeholder to extend the lease to be within £29,500 and £34,000 exclusive of costs.
In 2012 we were contacted by Ms Ellie Bernard who, having completed a basement apartment in Verwood in March 1997. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by ninety years. Comparative properties in Verwood with an extended lease were worth £242,600. The average amount of ground rent was £45 collected annually. The lease came to a finish in 2093. Having 67 years unexpired we estimated the compensation to the landlord to extend the lease to be within £11,400 and £13,200 plus fees.