The rule of thumb is, all other things holding equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Arnold have the right to extend the lease for an additional 90 years in accordance with the 1993 Leasehold Reform Act. Please give careful consideration before delaying your Arnold lease extension. Postponing the costs today simply increases the amount you will eventually be required to pay for a lease extension.
Leasehold residencies in Arnold with more than 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Using our service gives you better control over the value of your Arnold leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Henry was the the leasehold owner of a high value flat in Arnold on the market with a lease of a few days over 59 years unexpired. Henry on an informal basis spoke with his freeholder a well known local-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £125 annually. Ordinarily, ground rent would not be payable on a lease extension were Henry to invoke his statutory right. Henry obtained expert advice and secured satisfactory deal informally and sell the flat.
In 2009 we were called by Mr and Mrs. Y Lee who, having purchased a basement flat in Arnold in January 2005. The dilemma was if we could approximate the price would likely be to extend the lease by 90 years. Comparable premises in Arnold with an extended lease were valued around £260,200. The mid-range ground rent payable was £65 collected monthly. The lease came to a finish in 2091. Given that there were 66 years unexpired we calculated the premium to the landlord for the lease extension to be within £16,200 and £18,600 not including expenses.
Mrs Rosie Wilson completed a one bedroom apartment in Arnold in September 1997. The question was if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparative homes in Arnold with 100 year plus lease were valued around £198,800. The mid-range ground rent payable was £55 billed monthly. The lease lapsed in 2080. Taking into account 55 years remaining we approximated the premium to the landlord for the lease extension to be between £33,300 and £38,400 exclusive of expenses.