Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will usually be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Chesham. Inevitably, the period of lease remaining shortens over time. This may pass by relatively unnoticed when the residence needs to be disposed of or refinanced. The shorter the lease the less it is worth and the more expensive it will be to procure a lease extension. Qualifying leaseholders in Chesham have the legal entitlement to extend the lease for an additional 90 years under statute. Please give careful consideration before delaying your Chesham lease extension. Holding off that expense now likely increases the price you will ultimately incur to extend your lease
Leasehold residencies in Chesham with more than one hundred years outstanding on the lease are often 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 estate 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; |
| 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. |
| 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. |
| Yorkshire Building Society | 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. |
Lease extensions in Chesham can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Chesham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Trailing unsuccessful negotiations with the freeholder of her ground floor apartment in Chesham, Holly started the lease extension process just as her lease was approaching the crucial eighty-year threshold. The transaction was finalised in August 2007. The landlord’s costs were kept to an absolute minimum.
In 2010 we were phoned by Dr Ella Dupont who, having was assigned a lease of a first floor apartment in Chesham in August 2004. We are asked if we could estimate the price would be to extend the lease by 90 years. Identical premises in Chesham with 100 year plus lease were worth £250,000. The mid-range ground rent payable was £50 billed monthly. The lease expired on 28 August 2094. Taking into account 69 years remaining we estimated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including fees.
Mr and Mrs. C Peterson took over the lease of a first floor flat in Chesham in November 2007. The question was if we could shed any light on how much (roughly) premium would be for a 90 year extension to my lease. Comparable premises in Chesham with 100 year plus lease were worth £290,000. The average ground rent payable was £60 collected every twelve months. The lease terminated in 2105. Given that there were 80 years as a residual term we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of professional charges.