Cottingham leases on residential properties are gradually losing value. Where your lease has about 90 years unexpired, you should start considering the need for a lease extension. If lease term falls under eighty years, you will then be required to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Cottingham will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancing solicitor to confirm if you qualify. In some circumstances you may not be entitled. There are prescribed timetables and procedures to follow once the process has started so it’s wise to be guided by a conveyancing solicitor during the process.
Leasehold premises in Cottingham with in excess of 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| Yorkshire 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. |
Retaining our service gives you better control over the value of your Cottingham leasehold, as your property will be more valuable and marketable in terms 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.
Following unsuccessful discussions with the landlord of her first floor flat in Cottingham, Isabelle started the lease extension process just as the lease was approaching the crucial 80-year threshold. The lease extension completed in January 2011. The freeholder’s charges were kept to an absolute minimum.
In 2010 we were contacted by Dr Amber Thomas who, having moved into a studio flat in Cottingham in July 2002. The question was if we could approximate the premium would likely be to prolong the lease by a further 90 years. Identical residencies in Cottingham with 100 year plus lease were valued about £260,000. The average ground rent payable was £50 collected annually. The lease ran out on 22 March 2096. Given that there were 71 years left we calculated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including fees.
Mrs Ellie Miller was assigned a lease of a one bedroom flat in Cottingham in January 2007. The dilemma was if we could estimate the price would likely be to prolong the lease by 90 years. Identical properties in Cottingham with 100 year plus lease were worth £254,200. The mid-range amount of ground rent was £60 billed quarterly. The lease expiry date was on 23 October 2076. Taking into account 51 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £43,700 and £50,600 not including costs.