It’s a harsh certainty that a Ingleby Barwick residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Ingleby Barwick property prices.Where your lease has approximately ninety years left, you should start considering 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 slips lower than eighty years - otherwise a higher amount will be due. The majority of flat owners in Ingleby Barwick will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold residencies in Ingleby Barwick with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with procure Ingleby Barwick 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.
During the course of the last few months Dylan, started to get near to the 80-year mark with the lease on his leasehold flat in Ingleby Barwick. Having purchased his home two decades ago, the length of the lease was of no bearing. As luck would have it, it dawned on him that he would imminently be paying way over the odds for a lease extension. Dylan arranged for a lease extension at the eleventh hour in July. Dylan and the freeholder via the managing agents eventually settled on an amount of £5,500 . If the lease had gone to less than eighty years, the figure would have increased by at least £1,150.
In 2012 we were called by Dr Leon Pérez who, having bought a basement flat in Ingleby Barwick in July 2008. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be for a 90 year lease extension. Comparative homes in Ingleby Barwick with 100 year plus lease were worth £270,000. The average amount of ground rent was £55 invoiced annually. The lease ended on 11 October 2100. Considering the 75 years remaining we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of expenses.
In 2012 we were phoned by Mr P Ricardo who, having bought a newly refurbished apartment in Ingleby Barwick in April 1995. We are asked if we could approximate the premium would likely be to prolong the lease by 90 years. Comparative premises in Ingleby Barwick with a long lease were worth £173,800. The mid-range amount of ground rent was £65 collected every twelve months. The lease terminated on 27 August 2080. Considering the 55 years outstanding we estimated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 exclusive of professional charges.