For anyone whose Bideford property is held on a long lease, our message is clear – if nothing is done, your property will eventually revert to the freeholder, leaving you empty-handed. The shorter the lease the less it is worth and the more it will cost to extend the lease.
It is generally considered that a residential leasehold with over 100 years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Bideford lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
After lengthy correspondence with the freeholder of her one bedroom flat in Bideford, Alice started the lease extension process as the eighty year deadline was rapidly approaching. The transaction was concluded in June 2007. The landlord’s fees were kept to an absolute minimum.
Last July we were e-mailed by Mr and Mrs. M Clark , who acquired a basement apartment in Bideford in September 2005. We are asked if we could shed any light on how much (approximately) premium would likely be to extend the lease by 90 years. Comparable premises in Bideford with 100 year plus lease were valued around £230,800. The mid-range amount of ground rent was £60 billed quarterly. The lease ran out in 2085. Taking into account 60 years remaining we approximated the compensation to the freeholder for the lease extension to be within £24,700 and £28,600 exclusive of expenses.
Dr W Nelson took over the lease of a one bedroom apartment in Bideford in November 2000. The question was if we could approximate the premium could be for a 90 year extension to my lease. Comparative flats in Bideford with an extended lease were valued around £210,000. The mid-range ground rent payable was £50 billed monthly. The lease ended in 2105. Taking into account 80 years as a residual term we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 plus costs.