With a long leasehold premises in Haydock, you effectively rent it for a certain amount of time. In recent years 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 should think about a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately more expensive especially when there are less than eighty years left. Residents in Haydock with a lease approaching 81 years remaining should seriously consider extending it without delay. When a lease has fewer than 80 years outstanding, under the current Act the freeholder can calculate and levy a greater premium, assessed on a technical computation, strangely termed as “marriage value” which is payable.
It is generally accepted that a property with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years left, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Godiva Mortgages | 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. |
| 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. |
| 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. |
Lease extensions in Haydock can be a difficult process. We recommend you obtain guidance from a conveyancer and surveyor well versed in the legislation and lease extension process.
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 dealing with Haydock lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
During the course of the last few months Jude, started to get near to the 80-year threshold with the lease on his two bedroom apartment in Haydock. Having purchased his property two decades ago, the unexpired term was of no relevance. Fortunately, he recognised he would imminently be paying an escalated premium for a lease extension. Jude extended the lease just under the wire last July. Jude and the freeholder via the management company eventually agreed on a premium of £6,000 . If the lease had gone below eighty years, the amount would have escalated by at least £850.
In 2014 we were contacted by Mr and Mrs. E Kelly who, having completed a purpose-built apartment in Haydock in August 2008. The dilemma was if we could estimate the price would likely be to prolong the lease by 90 years. Similar premises in Haydock with a long lease were worth £203,200. The average amount of ground rent was £65 invoiced annually. The lease expired in 2087. Taking into account 61 years as a residual term we approximated the premium to the landlord to extend the lease to be within £19,000 and £22,000 exclusive of costs.
In 2012 we were called by Dr Naomi Anderson who, having took over the lease of a garden flat in Haydock in September 2008. We are asked if we could approximate the premium would be for a 90 year extension to my lease. Comparative premises in Haydock with 100 year plus lease were in the region of £260,000. The mid-range amount of ground rent was £50 billed monthly. The lease ended on 13 April 2098. Considering the 72 years left we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of fees.