Elm Park Lease Extension - Free Consultation

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Why you should commence your Elm Park lease extension

Top reasons for lease extension now:

A Elm Park lease depreciates with the years remaining on the lease.

It’s a harsh truth that a Elm Park residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Elm Park property market.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If lease term dips under eighty years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Elm Park will be able to extend under the legislation; however a conveyancer will be able to confirm if you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your conveyancer for the duration of the formalities.

An extended lease has roughly the same value as a freehold

It is generally accepted that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for decades to come.

Mortgage lenders will not lend on a short lease

Most banks have tightened lending criteria in the last ten years and borrowers are encountering difficulties in arranging funding or re-mortgage against flats with shorter lease terms, particularly under 75 years as they are regarded as inadequate for lending purposes.

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;
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.
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.
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.

Get in touch with one of our Elm Park lease extension solicitors or enfranchisement solicitors

Using our service will provide you increased control over the value of your Elm Park leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.

Elm Park Lease Extension Example Cases:

James, Elm Park, London,

James was the the leasehold proprietor of a 2 bedroom flat in Elm Park being marketed with a lease of fraction over 72 years remaining. James informally contacted his landlord being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to a new rent to start with set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were James to exercise his statutory right. James obtained expert legal guidance and was able to make an informed judgement and handle with the matter and sell the flat.

Elm Park case:

Last Christmas we were e-mailed by Mr and Mrs. L Torres , who moved into a garden flat in Elm Park in February 2010. The question was if we could estimate the premium would be to prolong the lease by 90 years. Similar properties in Elm Park with a long lease were worth £245,000. The mid-range amount of ground rent was £50 invoiced quarterly. The lease lapsed on 8 June 2091. Taking into account 68 years remaining we calculated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including expenses.

Decision in Havering

An example of a Lease Extension matter before the tribunal for a Elm Park premises is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case related to 1 flat. The number of years remaining on the existing lease(s) was 57.5 years.