East Bergholt 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 East Bergholt tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in East Bergholt you should see if your lease has between seventy and 90 years remaining. There are compelling reasons why a East Bergholt flat owner with a lease having around eighty years unexpired should take action to make sure that a lease extension is actioned without delay
Leasehold properties in East Bergholt with in excess of 100 years unexpired 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 buying 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. |
| 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 are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in East Bergholt,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with East Bergholt valuers.
In the wake of 6 months of unsuccessful discussions with the landlord of her basement apartment in East Bergholt, Victoria started the lease extension process just as the lease was approaching the crucial 80-year mark. The lease extension completed in October 2011. The freeholder’s costs were kept to an absolute minimum.
In 2012 we were phoned by Mr and Mrs. P López who, having owned a one bedroom flat in East Bergholt in November 2009. We are asked if we could approximate the premium could be for a ninety year extension to my lease. Comparative properties in East Bergholt with an extended lease were worth £285,000. The average ground rent payable was £55 billed every twelve months. The lease terminated on 17 September 2106. Taking into account 80 years left we estimated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including legals.
Mr H Nelson took over the lease of a one bedroom flat in East Bergholt in January 2012. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year extension to my lease. Comparative premises in East Bergholt with 100 year plus lease were in the region of £200,800. The average ground rent payable was £65 collected quarterly. The lease elapsed in 2086. Considering the 60 years remaining we approximated the premium to the freeholder to extend the lease to be within £20,900 and £24,200 exclusive of costs.