Crewkerne leases on residential deteriorating in value. Where your lease has about 90 years left, you should start considering the need for a lease extension. 80 years is a significant number: when the remaining term of a lease dips below this level then you begin incurring an additional element called marriage value. Flat owners in Crewkerne will mostly qualify for a lease extension; however a solicitor will check if you qualify. In some circumstances you may not be entitled. There are also strict timetables and procedures to comply with once the process has started so it’s wise to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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 gives you enhanced control over the value of your Crewkerne leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Felix owned a studio apartment in Crewkerne on the market with a lease of fraction over 72 years unexpired. Felix on an informal basis approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Felix to exercise his statutory right. Felix obtained expert advice and secured an acceptable resolution without going to tribunal and sell the flat.
Mr and Mrs. P Pérez owned a recently refurbished flat in Crewkerne in July 1999. The question was if we could shed any light on how much (roughly) premium would be to prolong the lease by ninety years. Identical homes in Crewkerne with a long lease were valued about £260,000. The mid-range amount of ground rent was £50 invoiced per annum. The lease ran out on 18 February 2097. Taking into account 72 years left we calculated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus fees.
Last Summer we were called by Dr Jamie Morgan , who was assigned a lease of a studio flat in Crewkerne in November 2003. We are asked if we could estimate the compensation to the landlord would be to extend the lease by ninety years. Identical flats in Crewkerne with 100 year plus lease were valued around £261,600. The mid-range ground rent payable was £60 collected monthly. The lease expired in 2077. Having 52 years as a residual term we approximated the premium to the freeholder to extend the lease to be between £39,000 and £45,000 not including professional charges.