Owning a apartment usually means owning a lease of the property, which has a finite term of years. The lease will usually be granted for a set period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Finchley. Clearly, the length of lease left shortens as time goes by. This may slip by relatively unnoticed when the residence needs to be disposed of or re-mortgaged. The fewer the years remaining the lower the value of the property and the more it will cost to extend the lease. Eligible leaseholders in Finchley have the legal entitlement to extend the lease for a further ninety years in accordance with the 1993 Leasehold Reform Act. Please give careful consideration before delaying your Finchley lease extension. Putting off that expense now likely increases the price you will eventually incur to extend your lease
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| 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. |
Retaining our service will provide you increased control over the value of your Finchley leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Zachary was the the leasehold proprietor of a 2 bedroom flat in Finchley on the market with a lease of just over sixty years outstanding. Zachary informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Zachary to invoke his statutory right. Zachary obtained expert advice and was able to make an informed decision and handle with the matter and readily saleable.
Ms Holly Baker purchased a one bedroom flat in Finchley in October 2000. The dilemma was if we could approximate the premium could be to prolong the lease by an additional years. Comparative homes in Finchley with 100 year plus lease were valued around £191,400. The average ground rent payable was £55 collected yearly. The lease elapsed in 2080. Given that there were 54 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £34,200 and £39,600 not including costs.
An example of a Lease Extension case for a Finchley premises is Ground Floor 110 Station Road in June 2013. The Tribunal found that the premium payable for a lease extension should be £31,665. This case was in relation to 1 flat. The remaining number of years on the lease was 56.65 years.