As the length of the unexpired term of a Callerton residential lease diminished so does its value and therefore the value of your property. Where the lease has, in excess of 100 years to run then this decrease may be of little impact however there will become a point in time when a lease has less than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the main rational as to why you should extend the lease sooner rather than later. Most flat owners in Callerton will meet the qualifying criteria; that being said a lawyer will be able to advise if you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth roughly 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 |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| 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. |
Lease extensions in Callerton can be a difficult process. We recommend you secure professional help from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Callerton lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Two years ago Arthur, started to get near to the eighty-year mark with the lease on his one bedroom flat in Callerton. Having purchased his home 19 years ago, the unexpired term was of no concern. Thankfully, he became aware that he would soon be paying an escalated premium for Extending the lease. Arthur extended the lease at the eleventh hour in September. Arthur and the freeholder in the end agreed on the final figure of £5,500 . If the lease had dipped lower than eighty years, the amount would have increased by a minimum £1,150.
Last Autumn we were called by Ms R Nelson , who completed a first floor apartment in Callerton in April 2001. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by an additional years. Similar flats in Callerton with a long lease were valued around £295,000. The average amount of ground rent was £45 billed yearly. The lease expired in 2100. Given that there were 74 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 plus expenses.
In 2009 we were called by Mr F Patel who, having took over the lease of a newly refurbished flat in Callerton in April 1998. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by 90 years. Similar homes in Callerton with an extended lease were worth £248,000. The average ground rent payable was £65 billed per annum. The lease came to a finish in 2089. Taking into account 63 years remaining we approximated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 not including costs.