For anyone whose Chaddesden property is held on a long lease, our message is clear – if you ignore the situation, the property will eventually revert to your landlord, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension.
It is generally considered that a residential leasehold with over 100 years unexpired lease term is worth approximately 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 many years ahead.
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
Engaging our service will provide you better control over the value of your Chaddesden leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
16 months ago Harvey, started to get near to the eighty-year threshold with the lease on his basement apartment in Chaddesden. Having purchased his property 19 years previously, the lease term was of minimal concern. Fortunately, it dawned on him that he needed to take action soon on a lease extension. Harvey was able to extend his lease at the eleventh hour last January. Harvey and the freeholder in the end settled on an amount of £6,000 . If he not met the deadline, the amount would have become more exhorbitant by at least £950.
In 2014 we were approached by Mr Eli Thomas who, having took over the lease of a purpose-built flat in Chaddesden in August 1997. We are asked if we could estimate the price would be to extend the lease by 90 years. Comparable flats in Chaddesden with an extended lease were worth £285,000. The average ground rent payable was £55 billed annually. The lease elapsed on 22 January 2105. Considering the 79 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 not including costs.
Last Christmas we were contacted by Mr and Mrs. F Roberts , who purchased a first floor apartment in Chaddesden in February 2005. The question was if we could shed any light on how much (approximately) premium would likely be for a 90 year extension to my lease. Similar premises in Chaddesden with a long lease were worth £193,400. The mid-range ground rent payable was £65 billed every twelve months. The lease expired on 1 March 2085. Considering the 59 years remaining we estimated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 plus professional charges.