For those whose Failsworth home is held on a long lease, the message is clear – if no remedial action is taken, your property will ultimately revert to your landlord, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to procure a lease extension.
Leasehold premises in Failsworth with over one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| 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 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; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
Lease extensions in Failsworth can be a difficult process. We recommend you get professional help from a conveyancer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Failsworth lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Aaron owned a 2 bedroom apartment in Failsworth being sold with a lease of just over 72 years outstanding. Aaron on an informal basis approached his freeholder being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £50 per annum. No ground rent would be payable on a lease extension were Aaron to exercise his statutory right. Aaron procured expert legal guidance and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last Autumn we were contacted by Mr and Mrs. R Kelly , who was assigned a lease of a one bedroom apartment in Failsworth in April 2000. The question was if we could estimate the compensation to the landlord could be to extend the lease by 90 years. Similar residencies in Failsworth with 100 year plus lease were worth £280,000. The average amount of ground rent was £55 collected yearly. The lease finished in 2104. Taking into account 78 years unexpired we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus legals.
In 2013 we were called by Mr and Mrs. H Gunderson who, having moved into a purpose-built flat in Failsworth in April 2007. The dilemma was if we could approximate the price could be for a 90 year lease extension. Comparable homes in Failsworth with a long lease were worth £191,000. The mid-range amount of ground rent was £65 billed every twelve months. The lease came to a finish in 2084. Taking into account 58 years as a residual term we approximated the compensation to the landlord to extend the lease to be within £23,800 and £27,400 exclusive of legals.