The value of Calverton 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 significantly once the unexpired lease term is less than eighty years
It is generally considered that a residential leasehold with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises 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. |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle Calverton 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.
Off the back of unsuccessful discussions with the landlord of her two bedroom apartment in Calverton, Morgan started the lease extension process just as her lease was nearing the critical eighty-year threshold. The lease extension was finalised in March 2011. The landlord’s costs were negotiated to approximately 700 pounds.
Last Spring we were called by Mr and Mrs. F Brown , who acquired a one bedroom apartment in Calverton in August 2004. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Similar properties in Calverton with a long lease were in the region of £295,000. The mid-range amount of ground rent was £45 collected per annum. The lease expiry date was on 13 October 2099. Taking into account 74 years outstanding we calculated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including legals.
Last August we were e-mailed by Mr and Mrs. A King , who was assigned a lease of a ground floor flat in Calverton in March 1995. The question was if we could shed any light on how much (roughly) premium would be for a ninety year lease extension. Similar residencies in Calverton with a long lease were worth £243,000. The average ground rent payable was £65 collected per annum. The lease expired in 2088. Given that there were 63 years unexpired we approximated the premium to the landlord to extend the lease to be between £20,000 and £23,000 not including legals.