For anyone whose Bedworth home is held on a long lease, the message is clear – if you do nothing, the property will eventually revert to your landlord, leaving you empty-handed. The fewer the years remaining the less it is worth and the more it will cost to obtain a lease extension.
Leasehold residencies in Bedworth with more than one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges justify 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a landlord in Bedworth,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Bedworth valuers.
Last Christmas Thomas, started to get close to the 80-year mark with the lease on his studio apartment in Bedworth. In buying his home two decades ago, the length of the lease was of no relevance. by good luck, he became aware that he would imminently be paying way over the odds for a lease extension. Thomas was able to extend his lease just ahead of time in September. Thomas and the freeholder in the end settled on an amount of £5,500 . If he failed to meet the deadline, the figure would have increased by at least £1,000.
In 2011 we were approached by Mrs Laura Robinson who, having acquired a one bedroom flat in Bedworth in November 2005. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparative flats in Bedworth with 100 year plus lease were valued about £260,200. The average amount of ground rent was £65 collected quarterly. The lease terminated in 2091. Having 66 years left we approximated the premium to the landlord for the lease extension to be within £16,200 and £18,600 plus legals.
Mrs Sarah Martinez was assigned a lease of a one bedroom apartment in Bedworth in June 1996. We are asked if we could approximate the compensation to the landlord could be for a ninety year lease extension. Identical properties in Bedworth with a long lease were in the region of £198,800. The mid-range amount of ground rent was £55 invoiced per annum. The lease lapsed in 2080. Considering the 55 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £33,300 and £38,400 plus legals.