Colyton leases on domestic properties are gradually losing value. Where your lease has in the region of ninety years remaining, you should start considering the need for a lease extension. An important point to note is that it is desirable for your lease extension to be in place before the term of the current lease drops below eighty years - otherwise a higher premium will be payable. Flat owners in Colyton will usually qualify for a lease extension; however it’s a good idea to check with a lawyer to confirm your eligibility. In some situations you may not qualify. There are prescribed timetables and steps to comply with once the process is initiated so it’s best to be guided by a conveyancing solicitor during the process.
Leasehold properties in Colyton with in excess of one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges merit it.
| 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. |
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Colyton 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.
Kian was the the leasehold proprietor of a 2 bedroom flat in Colyton on the market with a lease of fraction over 72 years outstanding. Kian on an informal basis approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 per annum. No ground rent would be due on a lease extension were Kian to invoke his statutory right. Kian procured expert legal guidance and was able to make an informed decision and handle with the matter and ending up with a market value flat.
Mr B Norbert acquired a one bedroom apartment in Colyton in April 1999. The question was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable homes in Colyton with an extended lease were worth £230,800. The mid-range amount of ground rent was £60 collected yearly. The lease finished in 2086. Considering the 60 years outstanding we approximated the premium to the freeholder to extend the lease to be between £24,700 and £28,600 exclusive of legals.
Last Summer we were e-mailed by Mr and Mrs. D Clark , who acquired a purpose-built flat in Colyton in July 2006. We are asked if we could shed any light on how much (approximately) price could be for a 90 year lease extension. Comparative premises in Colyton with a long lease were in the region of £210,000. The average ground rent payable was £50 billed every twelve months. The lease terminated on 24 July 2106. Given that there were 80 years outstanding we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of fees.