With a domestic leasehold premises in Horwich, you are actually purchasing an entitlement to live in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably when there are fewer than 80 years remaining. Anyone in Horwich with a lease approaching 81 years unexpired should seriously think of extending it as soon as possible. When a lease has under 80 years remaining, under the current statute the freeholder is entitled to calculate and levy a larger premium, based on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold premises in Horwich with more than one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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 conveyancing solicitors that we work with handle Horwich 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.
Half a year ago Luca, started to get close to the eighty-year mark with the lease on his ground floor apartment in Horwich. Having bought his flat two decades ago, the unexpired term was of minimal significance. Luckily, it dawned on him that he would soon be paying an escalated premium for Extending the lease. Luca was able to extend his lease just in the nick of time in March. Luca and the landlord eventually agreed on the final figure of £6,000 . If the lease had slid below 80 years, the figure would have gone up by a minimum £925.
In 2012 we were contacted by Ms J Evans who, having was assigned a lease of a basement flat in Horwich in May 2002. We are asked if we could approximate the premium could be to extend the lease by an additional years. Comparative premises in Horwich with 100 year plus lease were valued about £290,000. The mid-range ground rent payable was £45 collected quarterly. The lease terminated in 2097. Considering the 72 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £11,400 and £13,200 not including costs.
Last Spring we were approach by Dr D Alexander , who was assigned a lease of a purpose-built flat in Horwich in June 2009. We are asked if we could approximate the price could be to prolong the lease by 90 years. Comparative properties in Horwich with an extended lease were worth £233,200. The mid-range ground rent payable was £60 billed every twelve months. The lease finished on 13 March 2086. Having 61 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £22,800 and £26,400 not including legals.