With a residential leasehold premises in Cotgrave, you are actually buying a right to live in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may think about a lease extension sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly notably once there are fewer than 80 years left. Leasehold owners in Cotgrave with a lease nearing 81 years left should seriously consider extending it without delay. Once the lease term has less than eighty years outstanding, under the relevant statute the landlord can calculate and levy a larger premium, based on a technical computation, known as “marriage value” which is due.
Leasehold properties in Cotgrave with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value 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 |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Halifax | Minimum 70 years from the date 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. |
Irrespective of whether you are a tenant or a landlord in Cotgrave,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Cotgrave valuers.
Leon owned a conversion apartment in Cotgrave being marketed with a lease of just over 61 years unexpired. Leon on an informal basis contacted his landlord a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £200 annually. Ordinarily, ground rent would not be payable on a lease extension were Leon to exercise his statutory right. Leon procured expert legal guidance and secured an acceptable resolution without going to tribunal and sell the flat.
Mr and Mrs. W Davis purchased a ground floor apartment in Cotgrave in October 2007. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Comparable flats in Cotgrave with an extended lease were in the region of £285,000. The average amount of ground rent was £55 invoiced every twelve months. The lease elapsed in 2105. Having 80 years left we estimated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of professional charges.
In 2012 we were contacted by Mr and Mrs. K Lefebvre who, having completed a one bedroom flat in Cotgrave in August 2008. We are asked if we could estimate the price would be to prolong the lease by a further 90 years. Identical residencies in Cotgrave with a long lease were in the region of £200,800. The average amount of ground rent was £65 collected quarterly. The lease elapsed in 2085. Having 60 years outstanding we calculated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 plus costs.