The market value of Brinsworth leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase materialy once the remaining term is below than eighty years
It is generally considered that a property with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
The lawyers that we work with undertake Brinsworth 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.
During the course of the last few months Riley, came critically near to the eighty-year mark with the lease on his two bedroom apartment in Brinsworth. In buying his home 18 years previously, the lease term was of little bearing. Thankfully, he realised he would imminently be paying an escalated premium for Extending the lease. Riley extended the lease at the eleventh hour last April. Riley and the freeholder via the management company subsequently agreed on sum of £5,500 . If the lease had descended to less than eighty years, the figure would have become more exhorbitant by a minimum £1,025.
In 2009 we were phoned by Mr O Watson who, having owned a basement apartment in Brinsworth in September 1996. The dilemma was if we could shed any light on how much (roughly) price could be to prolong the lease by a further 90 years. Comparable properties in Brinsworth with 100 year plus lease were in the region of £176,200. The mid-range ground rent payable was £65 invoiced yearly. The lease lapsed on 5 January 2081. Having 56 years unexpired we estimated the compensation to the landlord to extend the lease to be within £29,500 and £34,000 plus fees.
In 2010 we were phoned by Dr N Brooks who, having owned a garden apartment in Brinsworth in March 1997. We are asked if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Comparable homes in Brinsworth with an extended lease were worth £242,600. The average ground rent payable was £45 billed quarterly. The lease expired on 19 April 2092. Considering the 67 years left we calculated the compensation to the freeholder for the lease extension to be within £11,400 and £13,200 plus fees.