Unfortunately that a Coleshill residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Coleshill property prices.Where your lease has approximately 90 years left, you should start considering a lease extension. If the number of years remaining falls under eighty years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Coleshill will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
It is conventional wisdom that a property with over one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you increased control over the value of your Coleshill leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
After lengthy correspondence with the freeholder of her studio flat in Coleshill, Georgina initiated the lease extension process just as her lease was nearing the all-important 80-year mark. The lease extension was finalised in January 2010. The landlord’s charges were negotiated to under 450 GBP.
Ms Tia Thomas acquired a one bedroom apartment in Coleshill in April 2001. The question was if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year lease extension. Comparative residencies in Coleshill with an extended lease were worth £210,000. The mid-range ground rent payable was £50 invoiced quarterly. The lease concluded on 27 May 2105. Having 80 years remaining we approximated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including legals.
In 2009 we were approached by Mr Matthew Rivera who, having owned a studio apartment in Coleshill in May 2002. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Comparable residencies in Coleshill with an extended lease were worth £280,000. The average amount of ground rent was £45 invoiced annually. The lease finished in 2094. Considering the 69 years unexpired we estimated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus professional charges.