Unfortunately that a Craven Arms residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Craven Arms property prices.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below 80 years - otherwise a higher premium will be payable. Most leasehold owners in Craven Arms will be able to extend under the legislation; however a lawyer will be able to confirm whether you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold residencies in Craven Arms with in excess of one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges justify 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| 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 will provide you better control over the value of your Craven Arms leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Trailing unsuccessful discussions with the freeholder of her purpose-built apartment in Craven Arms, Megan commenced the lease extension process as the eighty year deadline was quickly nearing. The lease extension was finalised in November 2010. The freeholder’s fees were kept to an absolute minimum.
Mr and Mrs. W Wright acquired a recently refurbished apartment in Craven Arms in July 1997. The question was if we could shed any light on how much (roughly) price would likely be to prolong the lease by an additional years. Identical premises in Craven Arms with a long lease were valued about £205,000. The average ground rent payable was £50 collected per annum. The lease terminated in 2104. Considering the 79 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of costs.
Mr and Mrs. T Clark bought a ground floor apartment in Craven Arms in November 2005. We are asked if we could estimate the premium would likely be to extend the lease by 90 years. Comparative premises in Craven Arms with a long lease were in the region of £275,000. The mid-range amount of ground rent was £65 billed annually. The lease ran out in 2093. Given that there were 68 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 not including professional charges.