Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will ordinarily be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Canning Town. Inevitably, the length of lease left reduces over time. This is often overlooked and only becomes a problem when the property has to be sold or refinanced. The fewer the years remaining the less it is worth and the more it will cost to obtain a lease extension. Eligible leaseholders in Canning Town have the legal entitlement to extend the lease for a further ninety years in accordance with the 1993 Leasehold Reform Act. You should give due deliberation before putting off your Canning Town lease extension. Holding off the cost now only increases the price you will eventually incur for a lease extension
Leasehold premises in Canning Town with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 conveyancers that we work with undertake Canning Town 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 conveyancing solicitor we work with provide it.
Last Spring Riley, came perilously close to the 80-year mark with the lease on his one bedroom flat in Canning Town. Having bought his flat two decades ago, the unexpired term was of no significance. Thankfully, he recognised he would imminently be paying an inflated amount for Extending the lease. Riley was able to extend his lease at the eleventh hour in April. Riley and the freeholder via the management company subsequently agreed on a premium of £5,500 . If he not met the deadline, the sum would have increased by at least £1,150.
Last Autumn we were contacted by Dr Lauren Carter , who completed a basement apartment in Canning Town in January 2006. The question was if we could approximate the price could be for a 90 year extension to my lease. Similar residencies in Canning Town with a long lease were valued about £193,400. The average ground rent payable was £65 invoiced annually. The lease ended on 19 March 2083. Having 59 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £21,900 and £25,200 not including expenses.
An example of a Lease Extension decision for a Canning Town flat is 46 Credon Road in January 2014. On 11 September 2013 Deputy District Judge Price sitting at the Bow County Court made a vesting order that the freeholder surrender his lease and be granted a new lease of the Premises on such terms as may be determined by the First Tier Tribunal (Property Chamber).The appropriate sum as concluded by the Tribunal was £7225 This case affected 1 flat. The remaining number of years on the lease was 69.77 years.