Essington leases on residential deteriorating in value. if your lease has in the region of ninety years remaining, you should start considering the need for a lease extension. 80 years is a significant number: when the remaining term of a lease falls below this level then you begin incurring an additional element called marriage value. Flat owners in Essington will mostly be legally entitled to a lease extension; however It would be wise to check with a conveyancer to confirm your eligibility. In certain circumstances you may not be entitled. There are also strict timetables and steps to comply with once the process has commenced so it’s best to be guided by a lawyer during the process.
Leasehold premises in Essington with over 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit 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. |
| Birmingham Midshires | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Essington 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 lawyer we work with provide it.
18 months ago Ibrahim, started to get close to the 80-year mark with the lease on his one bedroom apartment in Essington. Having purchased his property two decades ago, the lease term was of little importance. As luck would have it, he realised he needed to take steps soon on a lease extension. Ibrahim extended the lease at the eleventh hour last July. Ibrahim and the freeholder via the management company subsequently agreed on a premium of £5,500 . If he not met the deadline, the figure would have gone up by at least £1,075.
Last month we were called by Mrs Natalie Lambert , who moved into a purpose-built apartment in Essington in May 2010. We are asked if we could estimate the price would be to extend the lease by 90 years. Comparative flats in Essington with 100 year plus lease were worth £246,800. The mid-range amount of ground rent was £60 billed per annum. The lease expired on 17 November 2075. Taking into account 50 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £44,700 and £51,600 not including professional charges.
In 2012 we were approached by Dr Logan Dupont who, having purchased a newly refurbished flat in Essington in November 2009. The dilemma was if we could approximate the premium would be to prolong the lease by 90 years. Comparative residencies in Essington with an extended lease were valued about £203,200. The mid-range amount of ground rent was £65 invoiced every twelve months. The lease lapsed on 7 June 2086. Taking into account 61 years as a residual term we calculated the premium to the landlord to extend the lease to be between £19,000 and £22,000 exclusive of expenses.