It’s an underpublicised truth that a Horncastle residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Horncastle property market.Once your lease gets to 85ish years, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below eighty years - otherwise a higher amount will be payable. Most leasehold owners in Horncastle will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold premises in Horncastle with in excess of 100 years outstanding on the lease are often 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 freehold unless savings on ground rent and service charges justify it.
| 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; |
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Lease extensions in Horncastle can be a difficult process. We recommend you get guidance from a lawyer and valuer with experience in this area.
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 procuring Horncastle lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of 6 months of unsuccessful correspondence with the freeholder of her basement apartment in Horncastle, Sian initiated the lease extension process as the 80 year deadline was swiftly approaching. The transaction was concluded in June 2011. The freeholder’s fees were restricted to about 550 pounds.
Last Christmas we were approach by Dr Natalie Bertrand , who took over the lease of a one bedroom apartment in Horncastle in July 1996. The dilemma was if we could shed any light on how much (roughly) price could be for a 90 year lease extension. Comparative properties in Horncastle with an extended lease were worth £235,200. The average amount of ground rent was £45 collected per annum. The lease concluded in 2092. Taking into account 66 years as a residual term we calculated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.
Dr Caleb Bonnet bought a one bedroom apartment in Horncastle in August 2001. The dilemma was if we could approximate the price could be to extend the lease by 90 years. Comparable premises in Horncastle with a long lease were in the region of £275,000. The mid-range ground rent payable was £55 invoiced per annum. The lease terminated on 27 May 2103. Considering the 77 years as a residual term we approximated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of fees.