As the length of the unexpired term of a Buckfastleigh domestic lease lessens so does its value and therefore the value of your property. Where the lease has, more than one hundred years to run then this decrease may be of little impact however there will become a point in time when a lease has under than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the primary rational as to why you should extend the lease without delay. Many flat owners in Buckfastleigh will qualify for this right; that being said a conveyancing solicitor will be able to advise whether you are eligible for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Buckfastleigh with over 100 years outstanding 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 home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with procure Buckfastleigh 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 recent months Ollie, came critically close to the eighty-year threshold with the lease on his ground floor flat in Buckfastleigh. In buying his home twenty years previously, the unexpired term was of minimal interest. Thankfully, he recognised he needed to take action soon on a lease extension. Ollie was able to extend his lease at the eleventh hour last July. Ollie and the freeholder eventually settled on a premium of £6,000 . If he had missed the deadline, the figure would have gone up by a minimum £1,150.
In 2009 we were approached by Mr U Turner who, having moved into a newly refurbished apartment in Buckfastleigh in April 2011. We are asked if we could approximate the premium could be to extend the lease by 90 years. Identical flats in Buckfastleigh with an extended lease were valued about £275,000. The average amount of ground rent was £45 collected per annum. The lease ended in 2094. Considering the 69 years outstanding we calculated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including fees.
In 2011 we were phoned by Mr I Anderson who, having was assigned a lease of a newly refurbished apartment in Buckfastleigh in May 2011. The dilemma was if we could estimate the price could be for a 90 year extension to my lease. Comparable premises in Buckfastleigh with a long lease were in the region of £216,000. The average amount of ground rent was £60 invoiced yearly. The lease ended in 2083. Considering the 58 years unexpired we calculated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 not including professional charges.