For anyone whose Fowey flat is held on a long lease, the message is clear – if you do nothing, 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 obtain a lease extension.
Leasehold residencies in Fowey with more than 100 years unexpired 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 purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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 conveyancing solicitors that we work with handle Fowey 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.
Off the back of protracted negotiations with the freeholder of her ground floor flat in Fowey, Robyn initiated the lease extension process just as the lease was approaching the crucial eighty-year deadline. The transaction was finalised in November 2006. The freeholder’s costs were restricted to below 650 pounds.
Last June we were e-mailed by Ms B Cooper , who owned a purpose-built apartment in Fowey in January 2007. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by ninety years. Identical residencies in Fowey with a long lease were worth £193,400. The average amount of ground rent was £65 invoiced monthly. The lease finished on 25 February 2085. Given that there were 59 years unexpired we estimated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 not including costs.
Last Spring we were called by Ms Kate Wright , who acquired a garden apartment in Fowey in August 2008. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by an additional years. Comparative premises in Fowey with 100 year plus lease were in the region of £255,000. The average ground rent payable was £50 collected yearly. The lease ran out in 2096. Given that there were 70 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including expenses.