Unfortunately that a Godalming residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Godalming property market.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher premium will be due. Most leasehold owners in Godalming will be able to extend under the legislation; however a lawyer should be able to confirm if you are eligibility. In some cases 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 throughout the process.
Leasehold properties in Godalming with over one hundred 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 buying the reversionary interest unless savings on ground rent and service 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Godalming can be a difficult process. We recommend you obtain professional help from a lawyer and valuer with experience in this area.
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 a wealth of experience procuring Godalming 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 protracted negotiations with the freeholder of her garden flat in Godalming, Kirsty commenced the lease extension process just as the lease was approaching the crucial eighty-year deadline. The transaction was concluded in July 2007. The landlord’s costs were kept to an absolute minimum.
In 2012 we were approached by Ms P Moreau who, having acquired a basement apartment in Godalming in September 2011. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by an additional years. Similar premises in Godalming with a long lease were worth £174,200. The mid-range ground rent payable was £55 billed quarterly. The lease lapsed on 22 August 2076. Taking into account 51 years left we approximated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 plus expenses.
Last Spring we were contacted by Mr and Mrs. O Mercier , who was assigned a lease of a one bedroom apartment in Godalming in April 2001. The dilemma was if we could approximate the price would be for a ninety year extension to my lease. Comparable homes in Godalming with 100 year plus lease were valued about £285,000. The average amount of ground rent was £45 billed per annum. The lease elapsed in 2096. Considering the 71 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 plus professional charges.