As the the remaining lease term of a Hitchin residential lease decreases so does its value and therefore the value of your property. If the lease has, more than 125 years to run then this decrease may be negligible nevertheless there will become a stage when a lease has fewer than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the main reason why you should extend the lease without delay. Many flat owners in Hitchin will qualify for this right; however a conveyancing solicitor will be able to advise whether you are eligible for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold premises in Hitchin with in excess of 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth 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 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; |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Hitchin 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 lawyer we work with provide it.
Last Summer Aarav, came perilously near to the 80-year threshold with the lease on his basement flat in Hitchin. Having purchased his flat 18 years ago, the length of the lease was of no bearing. Thankfully, he noticed he needed to take steps soon on a lease extension. Aarav was able to extend his lease just ahead of time in July. Aarav and the landlord eventually settled on the final figure of £5,000 . If he had missed the deadline, the price would have become more costly by at least £925.
In 2013 we were called by Mr Jason Richardson who, having took over the lease of a basement flat in Hitchin in March 2006. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year lease extension. Identical residencies in Hitchin with an extended lease were worth £255,000. The mid-range ground rent payable was £50 billed annually. The lease elapsed in 2095. Having 70 years left we calculated the premium to the freeholder to extend the lease to be between £10,500 and £12,000 plus fees.
Last Spring we were phoned by Mrs Chloe Jackson , who moved into a first floor apartment in Hitchin in August 2010. We are asked if we could estimate the premium could be for a ninety year extension to my lease. Comparable residencies in Hitchin with 100 year plus lease were worth £246,800. The mid-range ground rent payable was £60 invoiced monthly. The lease lapsed on 13 October 2075. Given that there were 50 years remaining we estimated the premium to the freeholder for the lease extension to be between £44,700 and £51,600 exclusive of costs.