Cheetham leases on domestic deteriorating in value. if your lease has about ninety years remaining, you should start considering the need for a lease extension. Eighty years is a significant number: when the remaining term of a lease dips below this level then you start paying an additional element called marriage value. Leasehold owners in Cheetham will mostly be legally entitled to a lease extension; however a solicitor should be able confirm your eligibility. In some cases you may not qualify. There are prescribed deadlines and formalities to follow once the process is triggered so it’s best to be guided by a conveyancer during the process.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| 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; |
| Coventry Building Society | 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 be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
The conveyancing solicitors that we work with handle Cheetham 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 lawyer we work with provide it.
Rory was the the leasehold owner of a studio apartment in Cheetham being sold with a lease of a few days over sixty years left. Rory on an informal basis spoke with his landlord a well known London-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Rory to invoke his statutory right. Rory procured expert legal guidance and secured an acceptable resolution informally and sell the property.
In 2010 we were e-mailed by Mr and Mrs. T Bennett who, having owned a newly refurbished apartment in Cheetham in September 2006. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Comparable flats in Cheetham with 100 year plus lease were worth £166,800. The average amount of ground rent was £50 collected quarterly. The lease lapsed on 12 June 2076. Considering the 50 years remaining we calculated the premium to the freeholder for the lease extension to be within £32,300 and £37,400 exclusive of costs.
Mrs Kirsty Leroy bought a first floor apartment in Cheetham in September 2003. We are asked if we could approximate the price could be to extend the lease by 90 years. Comparable flats in Cheetham with a long lease were valued about £280,000. The average ground rent payable was £45 invoiced per annum. The lease finished on 21 February 2096. Taking into account 70 years outstanding we estimated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 not including expenses.