On the balance of probabilities if you own a flat in Bacup you actually own a long leasehold interest over your property
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date 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. |
Using our service gives you increased control over the value of your Bacup leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish 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.
Subsequent to unsuccessful discussions with the landlord of her ground floor flat in Bacup, Niamh started the lease extension process just as the lease was coming close to the crucial eighty-year threshold. The legal work was concluded in November 2010. The freeholder’s fees were restricted to under 550 GBP.
Dr David Martin took over the lease of a studio apartment in Bacup in July 2007. We are asked if we could shed any light on how much (approximately) price would be for a 90 year extension to my lease. Comparable homes in Bacup with 100 year plus lease were in the region of £210,600. The mid-range amount of ground rent was £45 collected every twelve months. The lease elapsed in 2088. Having 62 years outstanding we approximated the premium to the landlord for the lease extension to be within £18,100 and £20,800 exclusive of legals.
In 2011 we were phoned by Mrs O Evans who, having bought a purpose-built apartment in Bacup in October 2010. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Identical flats in Bacup with 100 year plus lease were valued about £265,000. The average ground rent payable was £50 collected per annum. The lease terminated in 2099. Considering the 73 years remaining we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including legals.