On the balance of probabilities if you own a flat in Babbacombe you actually own a long leasehold interest over your property
Leasehold residencies in Babbacombe with in excess of 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | 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. |
The conveyancing solicitors that we work with procure Babbacombe 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.
Half a year ago Jasper, started to get near to the 80-year threshold with the lease on his garden flat in Babbacombe. Having purchased his flat 18 years previously, the length of the lease was of minimal bearing. by good luck, he became aware that he needed to take action soon on Extending the lease. Jasper extended the lease just under the wire in March. Jasper and the landlord who owned the flat above in the end agreed on a premium of £5,500 . If the lease had dropped lower than 80 years, the figure would have gone up by a minimum £875.
In 2011 we were contacted by Ms R García who, having purchased a purpose-built flat in Babbacombe in June 2012. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Similar premises in Babbacombe with 100 year plus lease were in the region of £181,200. The mid-range amount of ground rent was £65 collected every twelve months. The lease lapsed in 2081. Having 56 years remaining we approximated the compensation to the freeholder to extend the lease to be within £29,500 and £34,000 exclusive of professional charges.
Last Spring we were called by Dr Y Cook , who acquired a ground floor flat in Babbacombe in August 1998. We are asked if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Similar properties in Babbacombe with an extended lease were valued around £242,600. The average amount of ground rent was £45 invoiced every twelve months. The lease lapsed on 27 April 2092. Taking into account 67 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £11,400 and £13,200 exclusive of fees.