With a residential leasehold property in Hetton Le Hole, you effectively rent it for a certain amount of time. These days 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 may consider a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than 80 years left. Leasehold owners in Hetton Le Hole with a lease drawing near to 81 years left should seriously consider extending it sooner as opposed to later. Once the lease term has less than 80 years remaining, under the current legislation the freeholder can calculate and demand a greater premium, assessed on a technical computation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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. |
The conveyancing solicitors that we work with handle Hetton Le Hole 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 conveyancing solicitor we work with provide it.
Jack owned a high value flat in Hetton Le Hole being marketed with a lease of just over 61 years left. Jack informally approached his freeholder a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £100 annually. No ground rent would be due on a lease extension were Jack to invoke his statutory right. Jack procured expert advice and secured an acceptable resolution informally and ending up with a market value flat.
In 2010 we were called by Mr and Mrs. Y Walker who, having was assigned a lease of a basement flat in Hetton Le Hole in June 2008. We are asked if we could estimate the price would likely be to extend the lease by ninety years. Similar premises in Hetton Le Hole with 100 year plus lease were worth £267,600. The average amount of ground rent was £65 collected monthly. The lease came to a finish in 2092. Considering the 67 years left we estimated the compensation to the landlord to extend the lease to be within £14,300 and £16,400 not including expenses.
Last Summer we were e-mailed by Mr and Mrs. M Kelly , who bought a purpose-built flat in Hetton Le Hole in May 2008. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Comparable homes in Hetton Le Hole with 100 year plus lease were worth £206,200. The average amount of ground rent was £60 collected every twelve months. The lease concluded in 2081. Taking into account 56 years outstanding we estimated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 not including professional charges.