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Why you should commence your Ditchling lease extension


Why you should commence your Ditchling lease extension today:

A Ditchling lease depreciates with the years remaining on the lease.

Owning a apartment usually means owning a lease of the property, which has a finite term of years. your lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Ditchling. Clearly, the length of lease left shortens over time. This is often overlooked and only raises itself as an issue when the residence needs to be disposed of or refinanced. The fewer the years remaining the lower the value of the property and the more expensive it will be to extend the lease. Qualifying leaseholders in Ditchling have the legal entitlement to extend the lease for an additional 90 years under Leasehold Reform legislation. Please give careful deliberation before delaying your Ditchling lease extension. Putting off that expense now simply increases the price you will eventually have to pay for a lease extension

Ditchling property with a lease extension has roughly the same value as a freehold

Leasehold properties in Ditchling with in excess of 100 years remaining 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 circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges merit it.

Lenders may decide not to loan monies with a short lease

The definition of a short lease varies by mortgage company, yet banks and building societies start to become jittery at around 75 years. This will be problematic when you wish to market or refinance your flat as it will be practically unmortgageable. Even though you may have no immediate plan to sell but when you do your purchaser will have to wait a couple of years before they can commence the legal procedures for an extension to the lease.

Lender Requirement
Bank of Scotland Minimum 70 years from the date of the mortgage.
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;
National Westminster Bank Mortgage term plus 30 years.
Skipton Building Society 85 years from the date of completion of the mortgage

For Buy to Let cases:
- lettings must not breach any of the lessee’s covenants; and
- consent of the lessor to lettings must be obtained if necessary
Virgin 85 years at the time of completion. If it's less, we require it to be extended on or before completion.

Why use us for your lease extension in Ditchling?

The conveyancers that we work with undertake Ditchling 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 conveyancing solicitor we work with provide it.

Ditchling Lease Extension Example Cases:

Jamie, Ditchling, East Sussex

In recent months Jamie, started to get near to the 80-year threshold with the lease on his two bedroom flat in Ditchling. Having bought his home two decades ago, the unexpired term was of no importance. Fortunately, it dawned on him that he needed to take steps soon on Extending the lease. Jamie was able to extend his lease at the eleventh hour last March. Jamie and the freeholder in the end agreed on the final figure of £5,500 . If he not met the deadline, the amount would have become more exhorbitant by a minimum £950.

Ditchling case:

Mr and Mrs. F Rivera was assigned a lease of a one bedroom apartment in Ditchling in March 1999. We are asked if we could shed any light on how much (roughly) price would be for a 90 year extension to my lease. Comparative homes in Ditchling with 100 year plus lease were in the region of £220,400. The mid-range amount of ground rent was £45 invoiced yearly. The lease concluded on 11 August 2088. Considering the 64 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £15,200 and £17,600 exclusive of fees.

Ditchling case:

Mr and Mrs. M Khan purchased a studio flat in Ditchling in August 2012. The dilemma was if we could shed any light on how much (roughly) price would be for a 90 year extension to my lease. Comparable properties in Ditchling with a long lease were valued about £270,000. The mid-range ground rent payable was £55 billed quarterly. The lease ended in 2099. Given that there were 75 years left we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including professional charges.