For those whose Bridport property is held on a long lease, the message is clear – if you do nothing, your property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more expensive it will be to procure a lease extension.
It is generally accepted that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| 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. |
| Birmingham Midshires | 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. |
| Halifax | 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 |
The conveyancing solicitors that we work with undertake Bridport 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.
Following lengthy correspondence with the freeholder of her purpose-built flat in Bridport, Samantha started the lease extension process as the eighty year deadline was swiftly coming. The legal work was concluded in July 2005. The freeholder’s charges were restricted to approximately four hundred pounds.
Last July we were e-mailed by Dr M Martin , who moved into a studio flat in Bridport in April 2001. The dilemma was if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Identical homes in Bridport with an extended lease were in the region of £275,000. The average ground rent payable was £65 invoiced quarterly. The lease ran out on 21 January 2094. Considering the 68 years as a residual term we calculated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 plus costs.
Last Summer we were called by Dr P Fournier , who was assigned a lease of a one bedroom flat in Bridport in January 2005. The question was if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by 90 years. Identical residencies in Bridport with 100 year plus lease were worth £213,600. The mid-range ground rent payable was £60 collected every twelve months. The lease finished in 2083. Given that there were 57 years unexpired we approximated the premium to the freeholder to extend the lease to be between £30,400 and £35,200 plus professional charges.