It’s a harsh certainty that a Bromyard residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Bromyard property market.Once your lease gets to 85ish years, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips below eighty years - otherwise a higher amount will be payable. The majority of leasehold owners in Bromyard will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
Leasehold properties in Bromyard with in excess of 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 handle Bromyard 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.
In the wake of 6 months of protracted negotiations with the landlord of her basement flat in Bromyard, Georgia commenced the lease extension process just as the lease was coming close to the crucial eighty-year mark. The transaction was concluded in June 2005. The landlord’s fees were kept to an absolute minimum.
Dr I Lambert moved into a basement flat in Bromyard in October 2002. The dilemma was if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Similar properties in Bromyard with an extended lease were worth £300,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease expired in 2101. Given that there were 76 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including professional charges.
Mr and Mrs. C Gray completed a basement flat in Bromyard in June 2005. The question was if we could shed any light on how much (approximately) premium would be to prolong the lease by an additional years. Similar residencies in Bromyard with an extended lease were valued around £257,800. The average amount of ground rent was £65 collected quarterly. The lease finished on 12 April 2090. Taking into account 65 years remaining we estimated the premium to the freeholder for the lease extension to be between £17,100 and £19,800 not including fees.