Erdington leases on residential properties are gradually losing value. Where your lease has about ninety years unexpired, you should start considering the need for a lease extension. It is important to recognise that it is that it is financially advisable for your lease extension to be in place before the term of the existing lease falls under 80 years - otherwise a higher amount will be payable. Flat owners in Erdington will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancer to confirm if you qualify. In certain cases you may not be entitled. There are also strict timetables and procedures to comply with once the process is triggered so it’s best to be guided by a conveyancer during the process.
Leasehold residencies in Erdington with more than 100 years remaining on the lease are often referred to as ‘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 purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service will provide you increased control over the value of your Erdington leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Andrew, came perilously near to the 80-year threshold with the lease on his garden apartment in Erdington. In buying his flat two decades ago, the length of the lease was of minimal interest. Fortunately, he realised he needed to take action soon on Extending the lease. Andrew was able to extend his lease at the eleventh hour last March. Andrew and the freeholder in the end agreed on the final figure of £6,000 . If he failed to meet the deadline, the premium would have become more exhorbitant by a minimum £925.
Dr M Roberts acquired a one bedroom flat in Erdington in March 2000. The question was if we could shed any light on how much (roughly) price would likely be to extend the lease by an additional years. Comparative residencies in Erdington with an extended lease were in the region of £218,000. The mid-range amount of ground rent was £45 collected annually. The lease ran out on 1 October 2089. Taking into account 63 years unexpired we estimated the premium to the landlord for the lease extension to be between £17,100 and £19,800 plus costs.
Last year we were contacted by Mr L Torres , who was assigned a lease of a ground floor apartment in Erdington in April 2010. The question was if we could estimate the price would be to extend the lease by an additional years. Comparative homes in Erdington with a long lease were worth £270,000. The average ground rent payable was £55 invoiced annually. The lease elapsed in 2100. Given that there were 74 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 plus costs.