Unfortunately that a Woburn residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Woburn property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than 80 years - otherwise a higher premium will be payable. The majority of leasehold owners in Woburn will be able to extend under the legislation; however a conveyancer will be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
Leasehold properties in Woburn with in excess of 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 premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
The conveyancers that we work with handle Woburn 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.
Following unsuccessful correspondence with the freeholder of her garden flat in Woburn, Ella initiated the lease extension process as the eighty year threshold was rapidly advancing. The legal work was concluded in April 2015. The freeholder’s costs were negotiated to below 650 GBP.
Dr I Lefebvre was assigned a lease of a basement apartment in Woburn in October 1998. The question was if we could shed any light on how much (approximately) premium could be to prolong the lease by ninety years. Comparable homes in Woburn with a long lease were in the region of £191,400. The mid-range ground rent payable was £55 billed per annum. The lease elapsed in 2080. Taking into account 54 years left we calculated the premium to the landlord to extend the lease to be within £34,200 and £39,600 exclusive of professional charges.
Ms Shannon Moore bought a first floor apartment in Woburn in October 2002. The dilemma was if we could approximate the premium would be for a ninety year lease extension. Similar flats in Woburn with an extended lease were worth £295,000. The mid-range amount of ground rent was £45 collected per annum. The lease expired in 2100. Given that there were 74 years remaining we calculated the premium to the landlord for the lease extension to be between £9,500 and £11,000 not including costs.