Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Dorridge. Inevitably, the term of lease remaining reduces over time. This is often ignored and only becomes a problem when the flat or house needs to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more it will cost to procure a lease extension. Eligible long lease owners in Dorridge have the legal entitlement to extend the lease for an additional 90 years in accordance with statute. Do give careful deliberation before putting off your Dorridge lease extension. Putting off that expense now only increases the price you will eventually have to pay for a lease extension
Leasehold properties in Dorridge with in excess of 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Godiva Mortgages | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
The lawyers that we work with handle Dorridge 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.
Half a year ago Liam, came dangerously near to the eighty-year threshold with the lease on his studio flat in Dorridge. In buying his home two decades ago, the length of the lease was of minimal significance. As luck would have it, he recognised he would soon be paying way over the odds for a lease extension. Liam extended the lease just under the wire in June. Liam and the freeholder via the management company eventually agreed on an amount of £5,000 . If he not met the deadline, the premium would have become more costly by at least £925.
In 2012 we were contacted by Dr F Baker who, having bought a studio flat in Dorridge in October 2003. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Comparative properties in Dorridge with a long lease were worth £267,600. The mid-range amount of ground rent was £65 billed monthly. The lease terminated on 3 August 2092. Given that there were 67 years remaining we calculated the premium to the freeholder to extend the lease to be within £14,300 and £16,400 exclusive of fees.
Dr O Hall purchased a ground floor flat in Dorridge in November 2005. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable homes in Dorridge with an extended lease were worth £206,200. The average amount of ground rent was £60 invoiced monthly. The lease terminated in 2081. Considering the 56 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 exclusive of professional charges.