Gainsborough leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Gainsborough residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Gainsborough you really ought to check if your lease has between 70 and ninety years left. There are compelling reasons why a Gainsborough leaseholder with a lease having around eighty years unexpired should take action to make sure that a lease extension is effected without delay
Leasehold premises in Gainsborough with over 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Retaining our service gives you increased control over the value of your Gainsborough leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of protracted discussions with the landlord of her first floor flat in Gainsborough, Samantha commenced the lease extension process as the eighty year threshold was fast advancing. The transaction completed in April 2008. The freeholder’s costs were restricted to a tad over 600 GBP.
Last month we were contacted by Mr Daniel Bernard , who was assigned a lease of a basement apartment in Gainsborough in February 2002. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by 90 years. Comparative premises in Gainsborough with an extended lease were in the region of £166,800. The average ground rent payable was £50 invoiced yearly. The lease terminated in 2075. Having 50 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £32,300 and £37,400 not including costs.
Last Summer we were e-mailed by Mr R Davies , who completed a basement apartment in Gainsborough in September 2001. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by a further 90 years. Identical properties in Gainsborough with an extended lease were valued around £280,000. The mid-range amount of ground rent was £45 collected monthly. The lease concluded on 28 March 2095. Taking into account 70 years unexpired we calculated the premium to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of expenses.