Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Kilgetty. Clearly, the term of lease remaining shortens over time. This is often ignored and only becomes a problem when the residence has to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more it will cost to procure a lease extension. Qualifying long lease owners in Kilgetty have the legal entitlement to extend the lease for an additional ninety years under Leasehold Reform legislation. You should give due deliberation before delaying your Kilgetty lease extension. Putting off that expense now likely increases the price you will eventually incur for a lease extension
Leasehold properties in Kilgetty with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value 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 service 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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 |
The lawyers that we work with undertake Kilgetty 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.
Oscar owned a high value apartment in Kilgetty on the market with a lease of fraction over 72 years outstanding. Oscar informally approached his landlord being a well known local-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 annually. Ordinarily, ground rent would not be due on a lease extension were Oscar to invoke his statutory right. Oscar procured expert advice and was able to make an informed judgement and deal with the matter and sell the flat.
Dr B Torres acquired a first floor apartment in Kilgetty in July 2012. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year lease extension. Identical properties in Kilgetty with an extended lease were in the region of £250,000. The average amount of ground rent was £50 collected quarterly. The lease came to a finish in 2093. Taking into account 68 years remaining we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of legals.
Last Winter we were contacted by Ms W Sharif , who moved into a ground floor flat in Kilgetty in August 2012. The question was if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Comparable flats in Kilgetty with an extended lease were in the region of £285,000. The mid-range amount of ground rent was £55 billed quarterly. The lease elapsed on 13 July 2104. Given that there were 79 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 plus fees.