When it comes to domestic leasehold property in Chadwell Heath, you are in fact renting it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you may consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately greater particularly once there are less than eighty years remaining. Anyone in Chadwell Heath with a lease approaching 81 years remaining should seriously consider extending it sooner as opposed to later. Once a lease has less than 80 years outstanding, under the current legislation the landlord can calculate and charge a greater amount, based on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold residencies in Chadwell Heath with over 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges justify it.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Using our service will provide you enhanced control over the value of your Chadwell Heath leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year Arthur, came very near to the 80-year threshold with the lease on his ground floor apartment in Chadwell Heath. In buying his flat two decades ago, the unexpired term was of minimal importance. Fortunately, he realised he needed to take action soon on Extending the lease. Arthur arranged for a lease extension at the eleventh hour in July. Arthur and the freeholder via the managing agents subsequently agreed on an amount of £5,500 . If he failed to meet the deadline, the figure would have become more exhorbitant by at least £1,125.
Mrs Abigail Watson moved into a studio apartment in Chadwell Heath in April 2009. We are asked if we could estimate the price would likely be for a ninety year lease extension. Identical residencies in Chadwell Heath with a long lease were in the region of £300,000. The mid-range amount of ground rent was £50 billed annually. The lease ran out on 8 November 2101. Taking into account 76 years outstanding we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of costs.
An example of a Lease Extension decision for a Chadwell Heath property is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case related to 1 flat. The remaining number of years on the lease was 61.36 years.