Hay On Wye leases on domestic properties are gradually losing value. if your lease has about 90 years remaining, you should start thinking about a lease extension. An important point to note is that it is financially advisable for a lease extension to take place before the term of the current lease drops below 80 years - otherwise a higher amount will be payable. Flat owners in Hay On Wye will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancing solicitor to check your eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is initiated so it’s sensible to be guided by a lawyer during the process.
Leasehold residencies in Hay On Wye with over 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges warrant it.
| 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
The conveyancing solicitors that we work with procure Hay On Wye 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.
After protracted negotiations with the landlord of her purpose-built flat in Hay On Wye, Caitlin started the lease extension process just as the lease was nearing the crucial 80-year mark. The legal work completed in April 2006. The freeholder’s fees were kept to an absolute minimum.
In 2010 we were approached by Mr and Mrs. S Petit who, having took over the lease of a newly refurbished apartment in Hay On Wye in February 2010. The question was if we could shed any light on how much (approximately) price would be to prolong the lease by ninety years. Similar homes in Hay On Wye with a long lease were worth £174,200. The average ground rent payable was £55 billed monthly. The lease ran out on 18 July 2076. Given that there were 51 years outstanding we calculated the premium to the landlord to extend the lease to be between £31,400 and £36,200 plus fees.
In 2010 we were contacted by Mr and Mrs. G Nguyen who, having moved into a purpose-built flat in Hay On Wye in May 2006. The question was if we could estimate the price would likely be to prolong the lease by a further 90 years. Similar flats in Hay On Wye with an extended lease were valued about £285,000. The average ground rent payable was £45 invoiced quarterly. The lease lapsed on 9 May 2096. Having 71 years remaining we calculated the premium to the landlord to extend the lease to be within £12,400 and £14,200 not including costs.