There is no doubt about it a leasehold flat or house in Fenstanton is a wasting asset as a result of the shortening lease. If the residual term has, more than 99 years remaining then this decrease may be negligible that being said there will become a point in time when a lease has less than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary logic behind why you should consider extending without delay. Most flat owners in Fenstanton will qualify for this right; that being said a conveyancer can advise if you qualify to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
It is generally accepted that a residential leasehold with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancers that we work with handle Fenstanton 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 conveyancing solicitor we work with provide it.
In the wake of 6 months of unsuccessful negotiations with the landlord of her leasehold flat in Fenstanton, Harriet started the lease extension process as the eighty year threshold was fast advancing. The lease extension was concluded in March 2013. The landlord’s fees were restricted to below 600 pounds.
Mrs H Vincent took over the lease of a ground floor flat in Fenstanton in August 2006. We are asked if we could shed any light on how much (roughly) price would be to prolong the lease by a further 90 years. Identical homes in Fenstanton with an extended lease were in the region of £183,600. The average amount of ground rent was £65 invoiced quarterly. The lease concluded on 26 June 2083. Given that there were 57 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £28,500 and £33,000 exclusive of professional charges.
Last April we were approach by Mr and Mrs. K Michel , who owned a newly refurbished flat in Fenstanton in May 2010. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Comparative residencies in Fenstanton with an extended lease were worth £245,000. The average amount of ground rent was £50 invoiced quarterly. The lease ran out in 2094. Considering the 68 years left we calculated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 not including fees.