As the length of the unexpired term of a East Coker domestic lease diminished so does its value and therefore the value of your property. If the residual term has, more than 100 years to run then this decrease may be negligible that being said there will become a stage when a lease has less than eighty years unexpired as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the primary rational as to why you should extend the lease sooner than later. Many flat owners in East Coker will meet the qualifying criteria; nevertheless a lawyer should be able to advise if you are eligible for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold residencies in East Coker with in excess of 100 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 home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| 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 |
Regardless of whether you are a tenant or a landlord in East Coker,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with East Coker valuers.
After lengthy negotiations with the freeholder of her studio flat in East Coker, Natasha commenced the lease extension process just as her lease was nearing the critical 80-year deadline. The transaction was finalised in February 2009. The freeholder’s costs were kept to an absolute minimum.
Mr and Mrs. P Davis acquired a ground floor flat in East Coker in February 2011. The dilemma was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Identical properties in East Coker with an extended lease were valued about £295,000. The average amount of ground rent was £45 billed every twelve months. The lease finished in 2099. Given that there were 74 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus fees.
In 2014 we were called by Mr and Mrs. R Cook who, having took over the lease of a recently refurbished flat in East Coker in June 2001. We are asked if we could estimate the compensation to the landlord could be to extend the lease by a further 90 years. Similar properties in East Coker with an extended lease were worth £243,000. The mid-range amount of ground rent was £65 invoiced annually. The lease expired in 2088. Taking into account 63 years unexpired we approximated the compensation to the freeholder to extend the lease to be within £20,000 and £23,000 exclusive of legals.