With a long leasehold property in Groby and Ratby, you are actually buying an entitlement to live in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially when there are fewer than 80 years left. Anyone in Groby and Ratby with a lease drawing near to 81 years left should seriously think of extending it sooner rather than later. Once the lease term has less than eighty years left, under the current legislation the landlord is entitled to calculate and levy a larger premium, assessed on a technical computation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 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. |
The conveyancers that we work with handle Groby and Ratby 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 conveyancer we work with provide it.
Last year Theo, started to get close to the eighty-year threshold with the lease on his one bedroom apartment in Groby and Ratby. In buying his property 19 years ago, the lease term was of little relevance. by good luck, he realised he would imminently be paying an escalated premium for a lease extension. Theo extended the lease just under the wire in June. Theo and the freeholder ultimately agreed on sum of £5,500 . If he had missed the deadline, the figure would have escalated by at least £1,000.
Dr Holly Bonnet was assigned a lease of a studio flat in Groby and Ratby in April 2008. The dilemma was if we could approximate the price would be to prolong the lease by 90 years. Comparative residencies in Groby and Ratby with an extended lease were worth £225,800. The average ground rent payable was £60 invoiced yearly. The lease terminated on 6 January 2086. Having 60 years outstanding we estimated the premium to the landlord to extend the lease to be within £25,700 and £29,600 exclusive of expenses.
In 2014 we were called by Dr W King who, having was assigned a lease of a basement apartment in Groby and Ratby in August 2004. We are asked if we could approximate the premium would likely be to prolong the lease by 90 years. Identical properties in Groby and Ratby with 100 year plus lease were in the region of £210,000. The mid-range amount of ground rent was £50 invoiced per annum. The lease lapsed in 2106. Taking into account 80 years remaining we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of legals.