East Bergholt leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in East Bergholt enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in East Bergholt you should investigate if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
Leasehold premises in East Bergholt with over 100 years left on the lease are sometimes referred to as ‘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 upside in purchasing the freehold unless savings on ground rent and service charges merit 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | 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. |
The conveyancers that we work with undertake East Bergholt 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.
Subsequent to lengthy discussions with the freeholder of her studio flat in East Bergholt, Ellie commenced the lease extension process just as the lease was nearing the critical eighty-year mark. The lease extension completed in October 2007. The landlord’s charges were restricted to approximately 650 pounds.
In 2011 we were called by Mr Lewis Edwards who, having moved into a basement apartment in East Bergholt in January 2007. The dilemma was if we could shed any light on how much (roughly) price would be to extend the lease by an additional years. Similar flats in East Bergholt with a long lease were worth £245,000. The mid-range ground rent payable was £50 billed every twelve months. The lease came to a finish on 25 March 2094. Taking into account 68 years remaining we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including expenses.
Mr and Mrs. N Harris took over the lease of a newly refurbished apartment in East Bergholt in May 1996. The question was if we could estimate the price could be for a ninety year lease extension. Identical flats in East Bergholt with 100 year plus lease were in the region of £285,000. The mid-range ground rent payable was £55 invoiced monthly. The lease concluded in 2105. Given that there were 79 years unexpired we approximated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of fees.