Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Cramlington. Clearly, the term of lease remaining shortens over time. This may pass by relatively unnoticed when the flat or house needs to be sold or refinanced. The shorter the lease the less it is worth and the more it will cost to extend the lease. Qualifying long lease owners in Cramlington have the legal entitlement to extend the lease for a further 90 years in accordance with the 1993 Leasehold Reform Act. Please give due attention before putting off your Cramlington lease extension. Holding off that expense now likely increases the price you will eventually incur to extend your lease
Leasehold premises in Cramlington with over 100 years left on the lease are often 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 upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant 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. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you increased control over the value of your Cramlington leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Theo, started to get close to the 80-year threshold with the lease on his two bedroom apartment in Cramlington. Having purchased his home two decades ago, the lease term was of little relevance. by good luck, he recognised he would imminently be paying an inflated amount for a lease extension. Theo extended the lease at the eleventh hour in June. Theo and the freeholder ultimately agreed on a premium of £5,000 . If the lease had slid lower than eighty years, the figure would have increased by at least £1,050.
Dr Y Peterson completed a newly refurbished flat in Cramlington in January 2011. The question was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Identical flats in Cramlington with 100 year plus lease were in the region of £193,400. The average ground rent payable was £65 invoiced yearly. The lease came to a finish in 2084. Having 59 years remaining we calculated the compensation to the landlord to extend the lease to be within £21,900 and £25,200 not including professional charges.
In 2009 we were contacted by Mrs Rachael Collins who, having completed a one bedroom flat in Cramlington in October 2000. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Similar residencies in Cramlington with 100 year plus lease were in the region of £250,000. The average amount of ground rent was £50 billed per annum. The lease concluded on 11 April 2095. Taking into account 70 years outstanding we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of costs.