Unfortunately that a Balby residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Balby property market.Once your lease nears 85ish years, you should start thinking about a lease extension. If the number of years remaining slips below 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of flat owners in Balby will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
It is generally accepted that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, the premises will be worth the same as a freehold for many years ahead.
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Lease extensions in Balby can be a difficult process. We recommend you obtain professional help from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Balby lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Twenty four months ago Kyle, started to get close to the eighty-year mark with the lease on his first floor flat in Balby. Having bought his flat two decades ago, the length of the lease was of no relevance. Luckily, he noticed he needed to take action soon on a lease extension. Kyle arranged for a lease extension just in the nick of time last June. Kyle and the freeholder via the managing agents eventually settled on a premium of £5,000 . If the lease had gone to less than 80 years, the price would have become more costly by a minimum £875.
In 2013 we were phoned by Mr and Mrs. L Williams who, having acquired a one bedroom apartment in Balby in January 2007. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Comparative homes in Balby with a long lease were in the region of £220,400. The mid-range ground rent payable was £45 invoiced every twelve months. The lease expired in 2089. Taking into account 64 years left we estimated the premium to the freeholder to extend the lease to be within £15,200 and £17,600 exclusive of legals.
Last Christmas we were e-mailed by Mrs N Morgan , who bought a first floor flat in Balby in September 2006. We are asked if we could estimate the price would likely be to extend the lease by an additional years. Comparative flats in Balby with a long lease were in the region of £270,000. The mid-range ground rent payable was £55 billed quarterly. The lease elapsed on 12 June 2100. Taking into account 75 years remaining we calculated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of costs.