There is no doubt about it a leasehold property in Framlingham is a wasting asset as a result of the diminishing lease term. Where the lease has, over 99 years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has under 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. Many flat owners in Framlingham will meet the qualifying criteria; nevertheless a conveyancer should be able to advise whether you are eligible for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is conventional wisdom that a property with over one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the property will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date 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. |
Using our service gives you better control over the value of your Framlingham leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Seth owned a 2 bedroom flat in Framlingham being marketed with a lease of fraction over sixty years remaining. Seth on an informal basis spoke with his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Seth to exercise his statutory right. Seth obtained expert legal guidance and secured an acceptable resolution without going to tribunal and sell the property.
In 2014 we were called by Mr and Mrs. G Miller who, having purchased a first floor flat in Framlingham in October 1998. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative flats in Framlingham with 100 year plus lease were in the region of £181,600. The mid-range ground rent payable was £55 collected annually. The lease came to a finish in 2078. Considering the 52 years outstanding we calculated the premium to the freeholder to extend the lease to be within £30,400 and £35,200 exclusive of expenses.
In 2011 we were phoned by Mr and Mrs. S Green who, having purchased a one bedroom flat in Framlingham in October 2002. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by ninety years. Similar flats in Framlingham with a long lease were worth £290,000. The mid-range amount of ground rent was £45 billed monthly. The lease terminated in 2098. Considering the 72 years left we estimated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 exclusive of legals.