For those whose Keston home is held on a long lease, our message is clear – if no remedial action is taken, the property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease.
Leasehold residencies in Keston with over one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify 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; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For a Lifetime Mortgage, the term must be no less than 150 years minus the age of the Borrower. |
| 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 procure Keston 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.
In the wake of 9 months of protracted discussions with the landlord of her basement flat in Keston, Amelia started the lease extension process just as her lease was nearing the all-important eighty-year mark. The transaction completed in January 2009. The freeholder’s fees were negotiated to below 450 pounds.
Last Winter we were phoned by Ms Madeleine Martínez , who moved into a studio apartment in Keston in March 2006. The question was if we could approximate the compensation to the landlord would likely be for a ninety year lease extension. Identical homes in Keston with an extended lease were worth £295,000. The average amount of ground rent was £45 collected per annum. The lease expired on 26 April 2096. Taking into account 74 years remaining we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 plus costs.
An example of a Lease Extension matter before the tribunal for a Keston residence is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case affected 1 flat. The number of years remaining on the existing lease(s) was 50.57 years.