As the the remaining lease term of a Bideford domestic lease lessens so does its value and therefore the value of your property. Where the lease has, in excess of 100 years to run then this decrease may be negligible that being said there will become a point in time when a lease has less than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the primary reason why you should extend the lease without delay. The majority of flat owners in Bideford will meet the qualifying criteria; nevertheless a conveyancer will be able to confirm if you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold residencies in Bideford with more than one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value 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 maintenance charges merit it.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle 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 lawyer we work with provide it.
Arthur owned a high value apartment in Bideford on the market with a lease of a few days over 61 years unexpired. Arthur informally approached his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Arthur to exercise his statutory right. Arthur obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
In 2009 we were approached by Ms Jennifer Allen who, having completed a first floor flat in Bideford in November 2007. We are asked if we could approximate the premium would be for a 90 year extension to my lease. Comparative flats in Bideford with an extended lease were in the region of £210,000. The average ground rent payable was £50 billed yearly. The lease ran out on 19 May 2106. Given that there were 80 years left we approximated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 not including professional charges.
Last Autumn we were approach by Mr Elijah Bonnet , who owned a studio flat in Bideford in October 2008. We are asked if we could approximate the premium could be to prolong the lease by 90 years. Similar properties in Bideford with an extended lease were in the region of £280,000. The mid-range amount of ground rent was £45 billed per annum. The lease elapsed on 24 February 2095. Having 69 years as a residual term we approximated the premium to the landlord for the lease extension to be between £12,400 and £14,200 plus expenses.