Flackwell Heath Lease Extension - Free Consultation

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Top reasons for Flackwell Heath lease extension


Top reasons for lease extension now:

Increase your lease and increase your Flackwell Heath property value

Unfortunately that a Flackwell Heath residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Flackwell Heath property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under eighty years - otherwise a higher amount will be payable. The majority of flat owners in Flackwell Heath will be able to extend under the legislation; however a lawyer should be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the process.

Flackwell Heath property with a lease extension has roughly the same value as a freehold

Leasehold residencies in Flackwell Heath with more than 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.

Mortgage lenders may decide not to finance a property with a short lease

The propensity since over the last decade has been for mortgage companies to tighten lending requirements across the board - this has extended to the types of security over which the home loan is to be granted. This has meant the unexpired lease term required by mortgage companies has increased. In the past banks would grant a mortgage on a lease with 25 years plus the term of the loan - typically 50 year leases but those requirements have been chipped away by the requirement for lengthy leases - many now have a minimum term of 75 years as standard.

Lender Requirement
Chelsea 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.
Leeds Building Society 85 years remaing from the start of the mortgage.
National Westminster Bank Mortgage term plus 30 years. For a Lifetime Mortgage, the term must be no less than 150 years minus the age of the Borrower.
Nationwide Building Society - Our minimum unexpired lease term is 55 years.
- There must be at least 30 years remaining at the end of the mortgage term (regardless of the length of lease at the start).

Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:

Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer

New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer

Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.

SECOND HAND PROPERTIES

Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 55 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period is less than or equal to 5 years

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 55 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial, etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 0.5% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI

NEW BUILD PROPERTIES (includes office conversions)

Unacceptable - advise Issuing Office (Will be declined)
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house (does not apply to Shared Ownership)
- Starting Ground Rent greater than 0.1% of the property value
- Ground Rent review period less than or equal to every 5 years
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Ground Rent is linked to any indices greater than RPI
- Ground Rent is linked to the value of the building*
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 0.5% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- Starting Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than 5 years
- Ground Rent escalation less than or equal to RPI

* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years.
Virgin 85 years at the time of completion. If it's less, we require it to be extended on or before completion.

Get in touch with one of our Flackwell Heath lease extension solicitors or enfranchisement solicitors

Lease extensions in Flackwell Heath can be a difficult process. We recommend you procure guidance from a lawyer and surveyor with experience in lease extensions.

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 a wealth of experience dealing with Flackwell Heath lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.

Flackwell Heath Lease Extension Example Cases:

Amber, Flackwell Heath, Buckinghamshire,

Following lengthy correspondence with the landlord of her basement flat in Flackwell Heath, Amber commenced the lease extension process just as the lease was nearing the crucial eighty-year mark. The transaction completed in January 2014. The freeholder’s fees were kept to an absolute minimum.

Flackwell Heath case:

Mr and Mrs. P James acquired a first floor flat in Flackwell Heath in July 2006. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable homes in Flackwell Heath with an extended lease were in the region of £225,800. The mid-range amount of ground rent was £60 invoiced per annum. The lease came to a finish in 2081. Having 60 years left we calculated the premium to the landlord for the lease extension to be within £25,700 and £29,600 plus costs.

Flackwell Heath case:

Mr and Mrs. U Laurent acquired a recently refurbished apartment in Flackwell Heath in November 2010. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year lease extension. Comparable residencies in Flackwell Heath with a long lease were valued around £210,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease elapsed on 16 September 2101. Considering the 80 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of legals.