With a long leasehold premises in Felpham, you are in fact renting it for a certain amount of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly notably when there are less than 80 years remaining. Residents in Felpham with a lease approaching 81 years unexpired should seriously consider extending it without delay. Once the lease term has fewer than 80 years remaining, under the relevant statute the landlord is entitled to calculate and charge a greater amount, assessed on a technical computation, known as “marriage value” which is due.
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the residence will be equivalent in value to a freehold for many years in the future.
| 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; |
| 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. |
| 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 also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with handle Felpham 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.
Leon was the the leasehold proprietor of a conversion flat in Felpham on the market with a lease of a little over 61 years outstanding. Leon on an informal basis spoke with his landlord being a well known London-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Leon to exercise his statutory right. Leon procured expert advice and was able to make an informed judgement and deal with the matter and readily saleable.
Dr Catherine Clark acquired a purpose-built flat in Felpham in August 1996. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Similar premises in Felpham with an extended lease were worth £246,800. The average amount of ground rent was £60 collected per annum. The lease ran out in 2075. Having 50 years outstanding we estimated the premium to the freeholder to extend the lease to be within £44,700 and £51,600 not including costs.
Dr Bethany Moore was assigned a lease of a purpose-built flat in Felpham in July 2005. We are asked if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Comparative properties in Felpham with 100 year plus lease were valued around £203,200. The average ground rent payable was £65 collected quarterly. The lease expired in 2086. Having 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 not including legals.