Unfortunately that a Chertsey residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Chertsey property prices.Once your lease nears 85ish years, you need to start thinking about a lease extension. If lease term slips below eighty years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of flat owners in Chertsey will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the formalities.
Leasehold premises in Chertsey with in excess of 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify 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; |
| Birmingham Midshires | 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 also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with undertake Chertsey 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 conveyancing solicitor we work with provide it.
Subsequent to unsuccessful negotiations with the landlord of her ground floor apartment in Chertsey, Niamh commenced the lease extension process as the eighty year deadline was fast nearing. The transaction was finalised in October 2006. The freeholder’s charges were kept to an absolute minimum.
In 2013 we were e-mailed by Mr Jacob Kelly who, having took over the lease of a basement apartment in Chertsey in July 1998. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by ninety years. Similar properties in Chertsey with a long lease were in the region of £246,800. The mid-range amount of ground rent was £60 invoiced every twelve months. The lease expired in 2075. Considering the 50 years remaining we calculated the premium to the landlord to extend the lease to be within £44,700 and £51,600 not including costs.
An example of a Lease Extension matter before the tribunal for a Chertsey property is 147 Redford Close in June 2012. The Tribunal determined the lease extension premium to be at £4,200 This case related to 1 flat. The unexpired term as at the valuation date was 82.93 years.