Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will usually be granted for a prescribed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Bedford. Clearly, the term of lease left reduces as time goes by. This is often ignored and only raises itself as an issue when the property has to be sold or re-mortgaged. The fewer the years remaining the lower the value of the property and the more it will cost to procure a lease extension. Qualifying leaseholders in Bedford have the legal entitlement to extend the lease for an additional 90 years under Leasehold Reform legislation. You should give careful attention before delaying your Bedford lease extension. Holding off the cost now simply increases the price you will ultimately have to pay for a lease extension
Leasehold residencies in Bedford with in excess of one hundred years outstanding 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 circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Using our service gives you enhanced control over the value of your Bedford leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of unsuccessful discussions with the landlord of her one bedroom flat in Bedford, Jodie commenced the lease extension process just as her lease was nearing the crucial 80-year threshold. The legal work was concluded in March 2014. The landlord’s charges were restricted to slightly above 600 GBP.
In 2010 we were e-mailed by Ms Erin Khan who, having purchased a ground floor apartment in Bedford in July 2008. The question was if we could approximate the compensation to the landlord would be to extend the lease by an additional years. Comparable residencies in Bedford with 100 year plus lease were worth £285,000. The mid-range amount of ground rent was £55 billed monthly. The lease ended in 2106. Given that there were 80 years remaining we estimated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of costs.
Mr and Mrs. K Martinez took over the lease of a one bedroom flat in Bedford in January 2012. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Comparable homes in Bedford with 100 year plus lease were in the region of £200,800. The mid-range ground rent payable was £65 billed every twelve months. The lease expired in 2086. Given that there were 60 years remaining we approximated the premium to the freeholder for the lease extension to be between £20,900 and £24,200 exclusive of fees.