Cleckheaton leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Cleckheaton residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Cleckheaton you should check if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold properties in Cleckheaton with more than 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Cleckheaton 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.
In 2014 Archie, started to get close to the eighty-year mark with the lease on his basement flat in Cleckheaton. In buying his home twenty years ago, the length of the lease was of no importance. by good luck, it dawned on him that he needed to take action soon on Extending the lease. Archie extended the lease just under the wire in April. Archie and the landlord who owned the flat above subsequently settled on sum of £5,500 . If the lease had dipped below 80 years, the premium would have escalated by a minimum £1,150.
In 2013 we were contacted by Mrs V Jackson who, having was assigned a lease of a purpose-built apartment in Cleckheaton in January 1995. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by ninety years. Comparable homes in Cleckheaton with a long lease were valued around £240,600. The average ground rent payable was £60 collected per annum. The lease ran out in 2087. Considering the 62 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £21,900 and £25,200 plus fees.
Dr M López moved into a basement flat in Cleckheaton in June 2011. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparative homes in Cleckheaton with 100 year plus lease were worth £174,200. The average ground rent payable was £55 invoiced monthly. The lease elapsed on 4 September 2076. Considering the 51 years left we estimated the premium to the landlord to extend the lease to be within £31,400 and £36,200 plus professional charges.