Bourne leases on domestic deteriorating in value. Where your lease has about 90 years remaining, you should start thinking about a lease extension. 80 years is a significant number: when the remaining term of a lease dips below this level then you begin incurring an additional element called marriage value. Flat owners in Bourne will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancer to confirm if you qualify. In certain circumstances you may not qualify. There are prescribed deadlines and steps to follow once the process is initiated so it’s best to be guided by a conveyancer during the process.
Leasehold residencies in Bourne with in excess of one hundred years outstanding on the lease are often 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 buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Godiva Mortgages | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Bourne,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Bourne valuers.
Liam owned a conversion apartment in Bourne on the market with a lease of just over fifty eight years outstanding. Liam informally approached his freeholder being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Liam to exercise his statutory right. Liam obtained expert legal guidance and secured satisfactory resolution informally and sell the flat.
In 2013 we were e-mailed by Ms O Martínez who, having owned a newly refurbished flat in Bourne in July 2011. The question was if we could estimate the price would be for a ninety year lease extension. Comparative homes in Bourne with an extended lease were valued about £275,000. The average ground rent payable was £45 billed every twelve months. The lease ran out in 2094. 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 exclusive of costs.
Last year we were approach by Dr I Ramírez , who moved into a studio flat in Bourne in October 2011. The question was if we could estimate the premium would likely be for a ninety year extension to my lease. Similar premises in Bourne with 100 year plus lease were in the region of £216,000. The mid-range ground rent payable was £60 collected quarterly. The lease expired on 9 October 2083. Taking into account 58 years remaining we calculated the premium to the freeholder for the lease extension to be between £28,500 and £33,000 exclusive of legals.