There is no doubt about it a leasehold property in Fradley is a wasting asset as a result of the diminishing lease term. If the lease has, over 99 years remaining then this decrease may be of little impact however there will become a stage when a lease has fewer than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the main reason why you should consider extending without delay. Most flat owners in Fradley will qualify for this right; that being said a conveyancer should be able to advise if you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold residencies in Fradley with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Fradley 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.
After lengthy negotiations with the landlord of her two bedroom flat in Fradley, Alicia initiated the lease extension process just as the lease was coming close to the critical 80-year threshold. The transaction was concluded in January 2005. The freeholder’s fees were restricted to slightly above 450 pounds.
In 2011 we were contacted by Mr and Mrs. K Phillips who, having owned a basement apartment in Fradley in May 2011. The question was if we could estimate the compensation to the landlord could be for a 90 year lease extension. Comparable premises in Fradley with a long lease were valued around £225,400. The average amount of ground rent was £45 collected monthly. The lease lapsed on 9 September 2090. Considering the 64 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £15,200 and £17,600 plus expenses.
Mr and Mrs. S Roberts acquired a one bedroom apartment in Fradley in April 1998. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparable flats in Fradley with an extended lease were in the region of £270,000. The average amount of ground rent was £55 collected annually. The lease elapsed in 2101. Having 75 years remaining we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of expenses.