Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Cowley. Inevitably, the period of lease remaining reduces as time goes by. This is often ignored and only becomes a problem when the flat or house needs to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension. Qualifying long lease owners in Cowley have the legal entitlement to extend the lease for a further ninety years in accordance with Leasehold Reform legislation. Please give careful consideration before delaying your Cowley lease extension. Putting off that expense now simply increases the price you will eventually have to pay for a lease extension
Leasehold residencies in Cowley with in excess of one hundred years unexpired 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 circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service will provide you better control over the value of your Cowley leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy negotiations with the freeholder of her basement flat in Cowley, Amelia commenced the lease extension process as the eighty year threshold was rapidly approaching. The transaction was concluded in February 2011. The landlord’s fees were restricted to less than 650 pounds.
Last January we were called by Mrs A Brooks , who acquired a one bedroom apartment in Cowley in September 2012. We are asked if we could shed any light on how much (approximately) premium could be for a 90 year extension to my lease. Comparative flats in Cowley with an extended lease were in the region of £225,800. The mid-range ground rent payable was £60 billed per annum. The lease finished in 2086. Having 60 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £25,700 and £29,600 not including costs.
An example of a Freehold Enfranchisement decision for a Cowley property is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case related to 2 flats. The remaining number of years on the lease was 69 years.