Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Chew Magna. Inevitably, the term of lease left shortens over time. This is often overlooked and only becomes a problem when the residence needs to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more expensive it will be to procure a lease extension. Eligible long lease owners in Chew Magna have the legal entitlement to extend the lease for a further 90 years under Leasehold Reform legislation. Do give due attention before delaying your Chew Magna lease extension. Putting off the cost now only increases the price you will eventually have to pay for a lease extension
It is generally accepted that a property with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| Halifax | Minimum 70 years from the date 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. |
| 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. |
The conveyancing solicitors that we work with procure Chew Magna 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 conveyancer we work with provide it.
Hugo owned a studio flat in Chew Magna on the market with a lease of a little over 61 years remaining. Hugo on an informal basis spoke with his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £50 per annum. Ordinarily, ground rent would not be due on a lease extension were Hugo to invoke his statutory right. Hugo obtained expert advice and secured an acceptable resolution without resorting to tribunal and readily saleable.
In 2010 we were e-mailed by Ms G André who, having moved into a first floor flat in Chew Magna in October 1999. The question was if we could approximate the price would likely be to extend the lease by 90 years. Identical residencies in Chew Magna with 100 year plus lease were worth £261,600. The average amount of ground rent was £60 collected per annum. The lease concluded in 2077. Given that there were 52 years outstanding we estimated the premium to the landlord to extend the lease to be between £39,000 and £45,000 plus fees.
Mrs C Morris purchased a purpose-built apartment in Chew Magna in October 2006. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Similar premises in Chew Magna with an extended lease were valued around £218,000. The mid-range amount of ground rent was £45 invoiced monthly. The lease came to a finish on 27 October 2088. Given that there were 63 years as a residual term we calculated the premium to the landlord for the lease extension to be between £17,100 and £19,800 not including legals.