Unfortunately that a Danescourt residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Danescourt property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. If the number of years remaining slips under eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Danescourt will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancer for the duration of the formalities.
Leasehold residencies in Danescourt with over one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value 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 estate charges justify 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. |
| 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; |
| Lloyds TSB Scotland | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service gives you better control over the value of your Danescourt leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Lucas, started to get near to the 80-year threshold with the lease on his basement flat in Danescourt. In buying his flat 18 years previously, the unexpired term was of minimal bearing. As luck would have it, he recognised he would imminently be paying way over the odds for Extending the lease. Lucas arranged for a lease extension just ahead of time last June. Lucas and the freeholder subsequently agreed on sum of £5,000 . If he had missed the deadline, the figure would have become more costly by a minimum £1,125.
Mr and Mrs. B Michel purchased a recently refurbished apartment in Danescourt in February 2003. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Comparable properties in Danescourt with a long lease were in the region of £285,000. The mid-range amount of ground rent was £45 billed yearly. The lease terminated on 26 July 2097. Given that there were 72 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 not including legals.
Last year we were e-mailed by Ms L David , who took over the lease of a basement flat in Danescourt in August 2007. The question was if we could shed any light on how much (roughly) price could be for a 90 year lease extension. Identical homes in Danescourt with an extended lease were in the region of £233,200. The average amount of ground rent was £60 invoiced quarterly. The lease lapsed in 2086. Considering the 61 years unexpired we estimated the compensation to the landlord for the lease extension to be between £22,800 and £26,400 not including costs.