For those whose Chatteris flat is held on a long lease, our message is clear – if no remedial action is taken, the property will ultimately revert to the freeholder, leaving you empty-handed. The shorter the lease the less it is worth and the more it will cost to procure a lease extension.
Leasehold premises in Chatteris with more than one hundred years unexpired 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 reversionary interest unless savings on ground rent and service charges warrant 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. |
| Bank of Scotland | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service will provide you enhanced control over the value of your Chatteris leasehold, as your property will be more valuable and saleable in respect of lease length should you want 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 Autumn Eli, came precariously near to the eighty-year threshold with the lease on his studio flat in Chatteris. In buying his property 19 years previously, the length of the lease was of no importance. Thankfully, it dawned on him that he needed to take action soon on a lease extension. Eli arranged for a lease extension at the eleventh hour in August. Eli and the freeholder via the management company subsequently agreed on an amount of £5,500 . If the lease had descended below eighty years, the amount would have become more exhorbitant by a minimum £1,125.
In 2013 we were phoned by Dr V Cook who, having acquired a basement apartment in Chatteris in April 2010. The question was if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by an additional years. Comparative flats in Chatteris with 100 year plus lease were in the region of £200,000. The mid-range amount of ground rent was £50 invoiced annually. The lease ran out on 3 June 2103. Taking into account 77 years remaining we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 plus fees.
Mr and Mrs. H Brown owned a basement flat in Chatteris in October 1997. The question was if we could approximate the premium would be for a ninety year lease extension. Comparative properties in Chatteris with 100 year plus lease were in the region of £265,200. The mid-range amount of ground rent was £65 billed quarterly. The lease ran out in 2092. Taking into account 66 years unexpired we estimated the compensation to the landlord to extend the lease to be between £15,200 and £17,600 exclusive of legals.