With a residential leasehold premises in Cubitt Town, you effectively rent it for a certain period of time. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are fewer than eighty years left. Anyone in Cubitt Town with a lease nearing 81 years left should seriously think of extending it as soon as possible. Once the lease term has under 80 years remaining, under the relevant statute the freeholder is entitled to calculate and charge a larger amount, assessed on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold residencies in Cubitt Town with in excess of 100 years outstanding on the lease are often 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 service 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 be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with handle Cubitt Town 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 conveyancer we work with provide it.
Last year Logan, started to get close to the 80-year threshold with the lease on his leasehold apartment in Cubitt Town. In buying his property twenty years ago, the lease term was of minimal significance. by good luck, he became aware that he would soon be paying an inflated amount for a lease extension. Logan extended the lease just under the wire in April. Logan and the freeholder via the managing agents in the end settled on sum of £6,000 . If he not met the deadline, the premium would have increased by a minimum £1,075.
Last Spring we were e-mailed by Mr and Mrs. L Michel , who owned a ground floor apartment in Cubitt Town in November 2002. We are asked if we could approximate the premium would be for a ninety year lease extension. Identical residencies in Cubitt Town with 100 year plus lease were worth £189,000. The average amount of ground rent was £55 collected yearly. The lease came to a finish in 2079. Having 53 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £28,500 and £33,000 exclusive of legals.
An example of a Freehold Enfranchisement matter before the tribunal for a Cubitt Town premises is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case was in relation to 3 flats. The unexpired lease term was 101.61 years.