For those whose Charlton property is held on a long lease, the message is clear – if no remedial action is taken, your property will eventually revert to the freeholder, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to procure a lease extension.
Leasehold residencies in Charlton with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
Engaging our service gives you enhanced control over the value of your Charlton leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy discussions with the freeholder of her one bedroom apartment in Charlton, Nicole initiated the lease extension process as the 80 year threshold was rapidly nearing. The lease extension was concluded in January 2013. The freeholder’s costs were negotiated to below 550 pounds.
In 2013 we were approached by Mr and Mrs. R Rose who, having completed a one bedroom flat in Charlton in July 2002. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by a further 90 years. Similar residencies in Charlton with an extended lease were in the region of £203,200. The average amount of ground rent was £65 invoiced every twelve months. The lease lapsed on 7 November 2086. Considering the 61 years remaining we estimated the premium to the landlord for the lease extension to be between £19,000 and £22,000 not including professional charges.
An example of a Lease Extension case for a Charlton residence is 73 Walerand Road in August 2012. the result of the findings of the Tribunal led to a premium to be paid for the extended lease in respect of Flat 73 in the sum of £10,040. The premium applicable in respect of Flat 85 was £5,710. This case affected 2 flats. The unexpired lease term was 72 years.