The basic rule is, all other things holding equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Arnside have the legal entitlement to extend the lease for a further 90 years under Leasehold Reform legislation. Please give careful consideration before delaying your Arnside lease extension. Shelving that expense today simply escalates the amount you will ultimately be required to pay to extend the lease.
It is generally accepted that a property with in excess of 100 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 ahead.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service will provide you enhanced control over the value of your Arnside leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Adam, came very close to the eighty-year threshold with the lease on his one bedroom apartment in Arnside. In buying his flat two decades ago, the length of the lease was of no importance. Luckily, he recognised he needed to take steps soon on a lease extension. Adam extended the lease at the eleventh hour in June. Adam and the freeholder via the management company ultimately settled on a premium of £5,500 . If he failed to meet the deadline, the amount would have increased by a minimum £975.
In 2012 we were contacted by Dr N Jackson who, having purchased a studio apartment in Arnside in June 1995. The dilemma was if we could approximate the premium could be for a 90 year extension to my lease. Comparative homes in Arnside with a long lease were valued about £198,800. The mid-range amount of ground rent was £55 collected yearly. The lease expired on 21 May 2081. Having 55 years left we calculated the premium to the freeholder to extend the lease to be between £33,300 and £38,400 plus expenses.
Last Summer we were approach by Mr C Mason , who was assigned a lease of a newly refurbished apartment in Arnside in July 2003. The dilemma was if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Comparable premises in Arnside with a long lease were worth £295,000. The average ground rent payable was £50 billed yearly. The lease lapsed on 13 March 2101. Taking into account 75 years remaining we calculated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of professional charges.