Why you should start your Hampstead lease extension
<div class="lm-topic lm-topic-lender">
<p>
<h3> Top reasons for lease extension now:
</h3>
<h4>
Increase your lease and increase your <a href="http://www.lendermonitor.com/conveyancing/loc/hampstead">Hampstead</a> property value </h4>
<p> It’s a harsh truth that a Hampstead residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Hampstead property prices.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If the number of years remaining drops below 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Hampstead will be able to extend under the legislation; however a lawyer will be able to confirm if you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
<h4>An extended lease is almost the same value as a freehold</h4>
<p> It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the premises will be worth the same as a freehold for many years ahead.
<h4>Lenders may not grant a mortgage on a short lease</h4>
The trend since over the last decade has been for mortgage companies to tighten lending criteria generally - this has extended to the types of security over which the home loan is to be charged. This has meant the unexpired lease term required by mortgage companies has increased. Historically lenders were content with twenty years plus the term of the loan - routinely fifty year leases but those requirements evolved by the requirement for lengthy leases - many now have a minimum term of 75 years as standard.
<p>
<div class="row">
<div class="col-sm-8">
<table class="table table-striped table-condensed">
<thead>
<tr><th>Lender</th>
<th> Requirement
</thead>
<tbody>
<tr>
<td>Accord Mortgages</td>
<td> 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.
</tr>
<tr>
<td>Bank of Scotland</td>
<td> Minimum 70 years from the date of the mortgage.
</tr>
<tr>
<td>Barclays plc</td>
<td> Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below).<br /><br />Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office.<br /><br />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:<br /><br />• 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<br />• The value of the property subject to the short remaining term is £500,000 or more AND<br />• 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;
</tr>
<tr>
<td>National Westminster Bank</td>
<td> Mortgage term plus 30 years.<br /><br />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.
</tr>
<tr>
<td>Virgin</td>
<td> 85 years at the time of completion. If it's less, we require it to be extended on or before completion.
</tr>
</tbody>
</table>
</div>
</div>
<h4> Get in touch with one of our Hampstead lease extension solicitors or enfranchisement solicitors
</h4>
<p> Irrespective of whether you are a tenant or a freeholder in Hampstead,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hampstead valuers.
<h4>
Hampstead Lease Extension Case Studies:
</h4>
<h5> Cameron, Hampstead, North London</h5>
<p> In 2014 Cameron, came seriously near to the 80-year threshold with the lease on his first floor flat in Hampstead. In buying his flat twenty years ago, the length of the lease was of minimal importance. by good luck, he recognised he would imminently be paying an escalated premium for a lease extension. Cameron arranged for a lease extension just under the wire in January. Cameron and the landlord subsequently agreed on sum of £5,000 . If he had missed the deadline, the sum would have gone up by a minimum £1,125.
<h5>Hampstead case:</h5>
<p>
Last July we were approach by Mrs T Morris , who
owned a one bedroom apartment in Hampstead in March 2003. The dilemma was if we could estimate the price could be to extend the lease by an additional years. Comparable premises in Hampstead with an extended lease were worth £285,000. The mid-range amount of ground rent was £55 collected every twelve months. The lease ran out on 8 March 2105. Taking into account 79 years left we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 plus expenses.
<div> <h5>Decision in Camden</h5>
<p>
An example of a Lease Extension matter before the tribunal for a Hampstead property is
Raised Ground Floor Flat 20 Fitzjohns Avenue in July 2014. the Tribunal decided that the premiums to be paid for new leases in respect of the Raised Ground Floor Flat and the First Floor Flat were to be calculated as: Raised Ground Floor: £765,175.14 First Floor: £601,617.77
This case related to 2 flats. The unexpired lease term was 16.83 and 16.43.
</p>
</div>
</div>