The value of Craven Arms leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate materialy once the remaining term is less than 80 years
Leasehold properties in Craven Arms with more than one hundred years outstanding 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 circumstances there is often little upside in purchasing the freehold 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | 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. |
| 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. |
The lawyers that we work with undertake Craven Arms lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Subsequent to unsuccessful discussions with the freeholder of her ground floor flat in Craven Arms, Niamh commenced the lease extension process just as the lease was approaching the crucial eighty-year mark. The lease extension completed in March 2010. The landlord’s costs were restricted to less than 500 GBP.
Last April we were e-mailed by Mr and Mrs. W Bennett , who moved into a studio apartment in Craven Arms in July 2002. We are asked if we could estimate the compensation to the landlord would be to extend the lease by a further 90 years. Similar residencies in Craven Arms with an extended lease were valued about £225,800. The mid-range amount of ground rent was £60 invoiced per annum. The lease came to a finish in 2085. Considering the 60 years remaining we approximated the compensation to the landlord to extend the lease to be between £24,700 and £28,600 plus fees.
Ms V Young owned a first floor flat in Craven Arms in March 2003. The question was if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar premises in Craven Arms with an extended lease were worth £210,000. The average ground rent payable was £50 collected annually. The lease finished on 16 April 2105. Considering the 80 years left we estimated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 plus professional charges.