Unfortunately that a Fradley residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Fradley property prices.Once your lease gets to 85ish years, you should start thinking about a lease extension. If lease term drops below eighty years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most leasehold owners in Fradley will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
Leasehold premises in Fradley with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| 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. |
| 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. |
| Coventry Building Society | 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. |
| 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. |
Lease extensions in Fradley can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer 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 in-depth market knowledge procuring Fradley lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of lengthy negotiations with the landlord of her one bedroom flat in Fradley, Tia started the lease extension process just as the lease was nearing the all-important 80-year deadline. The transaction was concluded in June 2005. The landlord’s charges were kept to an absolute minimum.
Mr and Mrs. L Howard took over the lease of a recently refurbished flat in Fradley in September 1995. We are asked if we could estimate the premium could be for a 90 year lease extension. Comparable flats in Fradley with a long lease were valued around £270,000. The average amount of ground rent was £55 collected annually. The lease concluded in 2099. Considering the 74 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including legals.
In 2009 we were contacted by Dr Theo Young who, having was assigned a lease of a one bedroom apartment in Fradley in September 2004. The question was if we could approximate the premium could be for a ninety year lease extension. Comparable premises in Fradley with a long lease were valued about £166,400. The mid-range amount of ground rent was £60 billed quarterly. The lease terminated on 17 May 2079. Given that there were 54 years outstanding we estimated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 not including fees.