The rule of thumb is, all other factors being equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Halifax can extend the lease for a further 90 years in accordance with statute. Please think carefully before delaying your Halifax lease extension. Postponing that expense today simply increases the amount you will eventually have to pay for a lease extension.
It is generally considered that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancing solicitors that we work with handle Halifax 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.
In recent months Cameron, came seriously near to the 80-year mark with the lease on his ground floor flat in Halifax. Having bought his flat 19 years ago, the unexpired term was of minimal relevance. Thankfully, he became aware that he needed to take action soon on a lease extension. Cameron extended the lease at the eleventh hour last August. Cameron and the landlord eventually agreed on a premium of £5,000 . If he had missed the deadline, the price would have increased by a minimum £850.
Last July we were contacted by Dr W Nelson , who acquired a recently refurbished flat in Halifax in February 2004. The dilemma was if we could shed any light on how much (approximately) premium could be to extend the lease by ninety years. Comparable residencies in Halifax with an extended lease were worth £275,000. The average ground rent payable was £45 collected every twelve months. The lease concluded in 2094. Taking into account 69 years outstanding we calculated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus legals.
Last Christmas we were approach by Mr and Mrs. H Walker , who purchased a studio apartment in Halifax in September 2004. We are asked if we could approximate the price could be to extend the lease by 90 years. Similar flats in Halifax with 100 year plus lease were worth £216,000. The mid-range ground rent payable was £60 collected per annum. The lease lapsed in 2083. Having 58 years unexpired we estimated the compensation to the landlord to extend the lease to be within £28,500 and £33,000 not including costs.