With a residential leasehold premises in Chorlton cum Hardy, you are actually buying a right to live in a property for a set period of time. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should think about extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are less than 80 years remaining. Anyone in Chorlton cum Hardy with a lease approaching 81 years left should seriously think of extending it without delay. Once a lease has under eighty years remaining, under the current Act the landlord can calculate and levy a greater amount, assessed on a technical computation, known as “marriage value” which is due.
It is generally accepted that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 procure Chorlton cum Hardy 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.
Last Winter Kian, started to get near to the 80-year threshold with the lease on his studio apartment in Chorlton cum Hardy. In buying his flat two decades ago, the unexpired term was of little interest. by good luck, he realised he needed to take action soon on a lease extension. Kian was able to extend his lease just ahead of time last January. Kian and the freeholder eventually settled on the final figure of £5,000 . If the lease had slipped lower than eighty years, the figure would have escalated by at least £1,125.
In 2013 we were e-mailed by Mrs S Ramírez who, having purchased a ground floor apartment in Chorlton cum Hardy in August 2002. We are asked if we could shed any light on how much (roughly) premium could be for a 90 year extension to my lease. Comparative flats in Chorlton cum Hardy with an extended lease were valued around £225,800. The average amount of ground rent was £60 collected quarterly. The lease ended in 2086. Having 60 years unexpired we estimated the premium to the landlord for the lease extension to be within £23,800 and £27,400 exclusive of fees.
In 2010 we were approached by Mr and Mrs. J Richardson who, having took over the lease of a basement flat in Chorlton cum Hardy in July 2003. The question was if we could shed any light on how much (roughly) premium would be to prolong the lease by 90 years. Comparative properties in Chorlton cum Hardy with 100 year plus lease were worth £210,000. The average ground rent payable was £50 collected every twelve months. The lease finished on 19 April 2106. Taking into account 80 years outstanding we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 exclusive of costs.