It’s an underpublicised certainty that a Benllech residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Benllech property prices.Once your lease nears 85ish years, you need to start considering a lease extension. If lease term falls under 80 years, you will end up paying half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Benllech will be able to extend under the legislation; however a lawyer should be able to confirm if you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your lawyer throughout the process.
Leasehold residencies in Benllech with more than 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 enhanced control over the value of your Benllech leasehold, as your property will be more valuable and saleable 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 leasehold flat in Benllech, Sophie initiated the lease extension process just as her lease was coming close to the crucial 80-year mark. The lease extension was finalised in November 2012. The landlord’s charges were restricted to less than 700 pounds.
Last month we were called by Mr H Robinson , who acquired a one bedroom flat in Benllech in February 2005. The dilemma was if we could estimate the premium would be to prolong the lease by an additional years. Comparative flats in Benllech with a long lease were in the region of £200,000. The mid-range ground rent payable was £50 billed every twelve months. The lease lapsed on 4 February 2103. Taking into account 78 years left we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 plus fees.
Last Christmas we were e-mailed by Mr and Mrs. D Harris , who moved into a garden flat in Benllech in May 2000. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative homes in Benllech with a long lease were valued about £267,600. The average amount of ground rent was £65 collected monthly. The lease came to a finish in 2092. Having 67 years left we approximated the premium to the freeholder for the lease extension to be between £14,300 and £16,400 exclusive of costs.