The basic rule is, all other things holding equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Barrow upon Humber may extend the lease for an additional 90 years in accordance with legislation. Please think carefully before delaying your Barrow upon Humber lease extension. Postponing that expense today simply escalates the amount you will ultimately have to pay to extend the lease.
Leasehold properties in Barrow upon Humber with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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; |
| Birmingham Midshires | 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
Engaging our service will provide you increased control over the value of your Barrow upon Humber leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
William owned a 2 bedroom apartment in Barrow upon Humber on the market with a lease of a little over 61 years outstanding. William on an informal basis approached his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £200 per annum. Ordinarily, ground rent would not be payable on a lease extension were William to invoke his statutory right. William procured expert advice and was able to make a more informed decision and deal with the matter and readily saleable.
Mrs N Girard bought a first floor flat in Barrow upon Humber in September 2002. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Identical properties in Barrow upon Humber with 100 year plus lease were valued around £264,000. The average amount of ground rent was £60 collected monthly. The lease concluded in 2078. Having 53 years left we calculated the compensation to the landlord for the lease extension to be between £37,100 and £42,800 plus costs.
Last year we were contacted by Mr and Mrs. S Simon , who bought a one bedroom apartment in Barrow upon Humber in October 2003. The dilemma was if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Similar residencies in Barrow upon Humber with an extended lease were worth £225,400. The mid-range amount of ground rent was £45 invoiced yearly. The lease came to a finish in 2089. Considering the 64 years remaining we calculated the premium to the landlord to extend the lease to be within £15,200 and £17,600 exclusive of professional charges.