Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will usually be granted for a set period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in West Thurrock. Clearly, the term of lease remaining reduces as time goes by. This is often ignored and only becomes a problem when the residence has to be sold or refinanced. The shorter the lease the lower the value of the property and the more expensive it will be to extend the lease. Eligible long lease owners in West Thurrock have the right to extend the lease for a further ninety years in accordance with the 1993 Leasehold Reform Act. You should give careful attention before putting off your West Thurrock lease extension. Putting off that expense now only increases the price you will eventually incur for a lease extension
Leasehold residencies in West Thurrock with in excess of 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest 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. |
| Godiva Mortgages | 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. |
The conveyancers that we work with procure West Thurrock 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 lawyer we work with provide it.
In the wake of 9 months of unsuccessful discussions with the freeholder of her leasehold flat in West Thurrock, Molly commenced the lease extension process as the 80 year deadline was quickly nearing. The transaction was concluded in November 2011. The landlord’s fees were negotiated to less than 500 pounds.
Last Winter we were e-mailed by Dr L Howard , who owned a first floor apartment in West Thurrock in September 1997. The dilemma was if we could estimate the premium would be to extend the lease by an additional years. Comparative properties in West Thurrock with an extended lease were valued about £225,400. The mid-range ground rent payable was £45 billed monthly. The lease elapsed on 9 August 2089. Given that there were 64 years remaining we approximated the premium to the landlord to extend the lease to be within £15,200 and £17,600 exclusive of costs.
An example of a Lease Extension case for a West Thurrock property is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case related to 13 flats. The unexpired term as at the valuation date was 76 years.