With a residential leasehold property in Henlow, you effectively rent it for a certain period 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 long period of time, you may consider extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are less than 80 years left. Anyone in Henlow with a lease approaching 81 years unexpired should seriously think of extending it without delay. Once a lease has below eighty years outstanding, under the relevant statute the freeholder can calculate and charge a larger amount, based on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold premises in Henlow with more than 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Henlow 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 Max, came seriously close to the 80-year threshold with the lease on his basement flat in Henlow. Having purchased his flat 18 years ago, the unexpired term was of minimal interest. by good luck, it dawned on him that he would imminently be paying an escalated premium for Extending the lease. Max arranged for a lease extension at the eleventh hour last March. Max and the freeholder via the management company in the end agreed on the final figure of £6,000 . If he failed to meet the deadline, the amount would have increased by a minimum £1,000.
Last month we were called by Ms O Jackson , who purchased a ground floor flat in Henlow in August 1998. The question was if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Comparative flats in Henlow with 100 year plus lease were in the region of £257,800. The mid-range ground rent payable was £65 billed per annum. The lease finished on 14 April 2090. Having 65 years outstanding we estimated the premium to the freeholder to extend the lease to be within £18,100 and £20,800 not including legals.
Last Spring we were approach by Mr E Jones , who completed a garden flat in Henlow in June 2001. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Similar residencies in Henlow with 100 year plus lease were worth £196,400. The average ground rent payable was £55 invoiced annually. The lease expired on 17 January 2079. Given that there were 54 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £35,200 and £40,600 exclusive of costs.