Brighstone leases on residential deteriorating in value. if your lease has in the region of ninety years left, you should start considering the need for a lease extension. It is important to recognise that it is that it is financially advisable for the lease extension to take place before the term of the current lease falls below 80 years - otherwise a higher amount will be payable. Leasehold owners in Brighstone will usually be legally entitled to a lease extension; however a solicitor should be able check your eligibility. In certain circumstances you may not be entitled. There are also strict deadlines and formalities to comply with once the process is initiated so it’s sensible to be guided by a conveyancing solicitor during the process.
Leasehold premises in Brighstone with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years 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. |
The conveyancing solicitors that we work with procure Brighstone 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.
In recent months Benjamin, came very near to the eighty-year mark with the lease on his garden apartment in Brighstone. In buying his home twenty years previously, the lease term was of little bearing. As luck would have it, he realised he needed to take steps soon on a lease extension. Benjamin extended the lease at the eleventh hour in May. Benjamin and the freeholder via the management company ultimately agreed on a premium of £5,500 . If the lease had slid lower than 80 years, the price would have increased by a minimum £850.
In 2014 we were e-mailed by Mr and Mrs. D Stewart who, having completed a purpose-built apartment in Brighstone in September 1997. We are asked if we could shed any light on how much (approximately) premium would likely be to extend the lease by ninety years. Identical homes in Brighstone with an extended lease were valued about £290,000. The mid-range ground rent payable was £45 collected per annum. The lease ran out on 17 June 2099. Considering the 74 years unexpired we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 plus legals.
In 2012 we were approached by Mr J Miller who, having moved into a purpose-built flat in Brighstone in July 2012. The question was if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar homes in Brighstone with 100 year plus lease were worth £243,000. The average ground rent payable was £65 collected per annum. The lease lapsed on 21 April 2088. Having 63 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £20,000 and £23,000 not including costs.