Cradley Heath residential property held on a long lease is a wasting asset as the leaseholder merely owns the property for a period of years.
Leasehold properties in Cradley Heath with more than 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges merit 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; |
| 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. |
| 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 also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you better control over the value of your Cradley Heath leasehold, as your property will be more valuable and saleable 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 lengthy discussions with the landlord of her leasehold flat in Cradley Heath, Alicia started the lease extension process as the eighty year deadline was swiftly nearing. The transaction was concluded in March 2007. The landlord’s fees were kept to an absolute minimum.
Mr and Mrs. E Hall completed a recently refurbished flat in Cradley Heath in July 2005. The question was if we could estimate the premium would be to extend the lease by a further 90 years. Similar residencies in Cradley Heath with 100 year plus lease were valued about £225,800. The average amount of ground rent was £60 collected quarterly. The lease expiry date was on 18 January 2085. Considering the 60 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £24,700 and £28,600 exclusive of expenses.
In 2011 we were phoned by Dr T Morel who, having completed a basement apartment in Cradley Heath in March 1999. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by a further 90 years. Comparable residencies in Cradley Heath with 100 year plus lease were in the region of £210,000. The average ground rent payable was £50 collected annually. The lease finished in 2105. Given that there were 80 years remaining we calculated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 exclusive of expenses.