The closer a domestic lease in Barlborough gets to zero years unexpired, the the greater the reduction in the value of the property. If the lease has, beyond 100 years remaining then this decrease may be fractional that being said there will become a stage when a lease has less than 80 years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary rational as to why you should consider extending without delay. Most flat owners in Barlborough will meet the qualifying criteria; however a lawyer can advise if you are eligible to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | 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. |
Engaging our service gives you increased control over the value of your Barlborough leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Mason owned a conversion flat in Barlborough on the market with a lease of a few days over 61 years remaining. Mason informally spoke with his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Mason to exercise his statutory right. Mason obtained expert advice and was able to make an informed judgement and handle with the matter and readily saleable.
In 2009 we were approached by Mr Eli López who, having acquired a studio apartment in Barlborough in April 2005. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical premises in Barlborough with 100 year plus lease were worth £233,200. The average amount of ground rent was £60 billed yearly. The lease concluded on 5 January 2086. Given that there were 61 years left we approximated the compensation to the landlord for the lease extension to be within £22,800 and £26,400 plus fees.
In 2013 we were called by Dr R Edwards who, having owned a ground floor flat in Barlborough in February 2002. The dilemma was if we could approximate the premium would be for a 90 year extension to my lease. Identical flats in Barlborough with an extended lease were worth £171,800. The average ground rent payable was £55 invoiced quarterly. The lease elapsed in 2075. Considering the 50 years remaining we approximated the premium to the landlord for the lease extension to be within £33,300 and £38,400 plus fees.