It’s a harsh certainty that a Ainsdale residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Ainsdale property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. If the number of years remaining dips under 80 years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of flat owners in Ainsdale will be able to extend under the legislation; however a conveyancer should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your lawyer from beginning to end of the formalities.
Leasehold properties in Ainsdale with more than 100 years unexpired on the lease are often regarded as a ‘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 purchasing the freehold unless savings on ground rent and maintenance charges merit 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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The conveyancers that we work with procure Ainsdale 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 lengthy correspondence with the landlord of her first floor flat in Ainsdale, Sophie commenced the lease extension process as the 80 year threshold was rapidly coming. The legal work completed in November 2014. The landlord’s costs were negotiated to under 700 pounds.
Last Winter we were e-mailed by Dr Caitlin Brooks , who acquired a garden apartment in Ainsdale in November 2011. The dilemma was if we could approximate the premium would be to prolong the lease by ninety years. Comparative homes in Ainsdale with a long lease were valued about £181,600. The mid-range ground rent payable was £55 collected yearly. The lease finished on 27 November 2078. Considering the 52 years left we estimated the compensation to the landlord to extend the lease to be within £30,400 and £35,200 plus legals.
Last month we were phoned by Dr F Pérez , who acquired a basement apartment in Ainsdale in June 2002. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by ninety years. Comparative flats in Ainsdale with a long lease were worth £290,000. The average ground rent payable was £45 invoiced annually. The lease elapsed on 25 April 2098. Having 72 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £11,400 and £13,200 plus professional charges.