With a residential leasehold premises in Blackburn, you are actually buying a right to live in a property for a set period of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are less than eighty years remaining. Leasehold owners in Blackburn with a lease nearing 81 years left should seriously consider extending it as soon as possible. When a lease has below eighty years remaining, under the current Act the landlord is entitled to calculate and charge a greater premium, assessed on a technical computation, known as “marriage value” which is payable.
Leasehold residencies in Blackburn with in excess of one hundred years unexpired 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 to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Blackburn,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Blackburn valuers.
Teddy was the the leasehold proprietor of a conversion flat in Blackburn on the market with a lease of a little over 59 years remaining. Teddy on an informal basis spoke with his landlord being a well known local-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 on the basis of a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Teddy to invoke his statutory right. Teddy procured expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
Last Summer we were called by Dr Ollie Howard , who acquired a recently refurbished apartment in Blackburn in May 1995. We are asked if we could approximate the premium would be for a ninety year lease extension. Comparable flats in Blackburn with a long lease were valued about £255,000. The average amount of ground rent was £50 collected yearly. The lease ended in 2097. Considering the 71 years as a residual term we calculated the premium to the landlord for the lease extension to be between £9,500 and £11,000 plus professional charges.
Last Spring we were approach by Mr and Mrs. P Smith , who purchased a purpose-built apartment in Blackburn in March 2004. The question was if we could shed any light on how much (approximately) compensation to the landlord could be for a 90 year lease extension. Comparative properties in Blackburn with a long lease were in the region of £254,200. The average amount of ground rent was £60 collected per annum. The lease lapsed in 2077. Taking into account 51 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £43,700 and £50,600 exclusive of legals.