Cullompton leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Cullompton tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Cullompton you really ought to see if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Cullompton with over 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Cullompton can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Cullompton lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Harvey, came very close to the 80-year threshold with the lease on his leasehold apartment in Cullompton. Having purchased his property two decades ago, the unexpired term was of no importance. by good luck, he recognised he would soon be paying an inflated amount for Extending the lease. Harvey extended the lease just under the wire last September. Harvey and the landlord ultimately agreed on a premium of £5,000 . If he failed to meet the deadline, the premium would have gone up by at least £1,125.
Last Christmas we were called by Mr Joshua Phillips , who purchased a one bedroom flat in Cullompton in January 1995. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by an additional years. Comparable homes in Cullompton with 100 year plus lease were valued about £261,600. The mid-range ground rent payable was £60 billed monthly. The lease ran out on 6 May 2077. Having 52 years unexpired we estimated the compensation to the landlord to extend the lease to be between £39,000 and £45,000 exclusive of expenses.
In 2014 we were contacted by Mr and Mrs. P Fournier who, having took over the lease of a basement flat in Cullompton in March 2002. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by ninety years. Similar properties in Cullompton with 100 year plus lease were valued around £218,000. The mid-range amount of ground rent was £45 billed annually. The lease expired on 10 January 2088. Having 63 years remaining we approximated the premium to the freeholder for the lease extension to be within £17,100 and £19,800 not including expenses.