On the balance of probabilities where you own a flat in Bredon you actually own a long leasehold interest over your property
Leasehold properties in Bredon with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Bredon 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 conveyancer we work with provide it.
Last year Henry, started to get near to the eighty-year threshold with the lease on his ground floor apartment in Bredon. Having bought his flat 18 years previously, the unexpired term was of little relevance. Fortunately, he became aware that he needed to take steps soon on a lease extension. Henry was able to extend his lease just under the wire last January. Henry and the landlord who owned the flat above subsequently settled on an amount of £6,000 . If he not met the deadline, the premium would have escalated by a minimum £850.
Mr and Mrs. D Davis purchased a ground floor apartment in Bredon in January 2012. We are asked if we could estimate the premium would be to prolong the lease by a further 90 years. Comparative premises in Bredon with a long lease were worth £240,600. The average amount of ground rent was £60 billed per annum. The lease elapsed on 12 July 2088. Taking into account 62 years unexpired we calculated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 plus fees.
In 2010 we were phoned by Mr F James who, having bought a one bedroom flat in Bredon in July 2001. The dilemma was if we could approximate the compensation to the landlord could be for a ninety year lease extension. Comparable flats in Bredon with a long lease were in the region of £174,200. The mid-range amount of ground rent was £55 billed monthly. The lease lapsed in 2077. Having 51 years remaining we estimated the premium to the landlord to extend the lease to be between £31,400 and £36,200 exclusive of fees.