Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will ordinarily be granted for a fixed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Bideford. Inevitably, the term of lease remaining shortens as time goes by. This may pass by relatively unnoticed when the property has to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to procure a lease extension. Qualifying long lease owners in Bideford have the legal entitlement to extend the lease for a further ninety years under legislation. Do give due consideration before putting off your Bideford lease extension. Holding off the cost now likely increases the price you will ultimately incur to extend your lease
It is generally accepted that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you better control over the value of your Bideford leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Isaac owned a conversion apartment in Bideford being sold with a lease of a few days over 61 years outstanding. Isaac on an informal basis spoke with his landlord a well known Bristol-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Isaac to invoke his statutory right. Isaac procured expert legal guidance and secured an acceptable deal without resorting to tribunal and readily saleable.
In 2012 we were e-mailed by Mr H Evans who, having completed a basement apartment in Bideford in February 2010. We are asked if we could shed any light on how much (approximately) premium could be to extend the lease by an additional years. Similar residencies in Bideford with 100 year plus lease were in the region of £213,600. The average amount of ground rent was £60 invoiced annually. The lease expired in 2083. Considering the 57 years outstanding we approximated the premium to the landlord to extend the lease to be within £30,400 and £35,200 not including costs.
In 2013 we were called by Mrs Naomi Rodríguez who, having acquired a one bedroom apartment in Bideford in October 2001. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by 90 years. Comparative homes in Bideford with a long lease were in the region of £200,000. The mid-range amount of ground rent was £50 collected annually. The lease elapsed on 14 April 2103. Given that there were 77 years outstanding we calculated the premium to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of professional charges.