Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will normally be granted for a set period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Hermon. Clearly, the length of lease remaining shortens over time. This may slip by relatively unnoticed when the flat or house needs to be disposed of or re-mortgaged. The shorter the lease the less it is worth and the more it will cost to obtain a lease extension. Qualifying long lease owners in Hermon have the legal entitlement to extend the lease for an additional 90 years in accordance with legislation. You should give due consideration before delaying your Hermon lease extension. Holding off that expense now simply increases the price you will eventually incur to extend your lease
Leasehold residencies in Hermon with more than one hundred years remaining on the lease are sometimes 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 upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. 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. |
| 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 lawyers that we work with procure Hermon 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.
Leon owned a high value flat in Hermon on the market with a lease of a few days over fifty eight years unexpired. Leon on an informal basis spoke with his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £50 annually. Ordinarily, ground rent would not be payable on a lease extension were Leon to invoke his statutory right. Leon obtained expert legal guidance and secured an acceptable deal informally and sell the property.
Mrs Jodie Bertrand bought a one bedroom apartment in Hermon in July 2005. The dilemma was if we could approximate the premium could be for a ninety year extension to my lease. Comparable homes in Hermon with an extended lease were worth £200,800. The average amount of ground rent was £65 invoiced quarterly. The lease ended in 2086. Considering the 60 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 not including legals.
Last year we were called by Mr and Mrs. L Morris , who moved into a one bedroom apartment in Hermon in April 2006. The dilemma was if we could approximate the premium would likely be to extend the lease by an additional years. Identical premises in Hermon with an extended lease were valued about £255,000. The average ground rent payable was £50 collected every twelve months. The lease ran out on 3 July 2097. Given that there were 71 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including fees.