As the length of the unexpired term of a Killay residential lease diminished so does its value and therefore the value of your property. Where the lease has, more than 125 years to run then this decrease may be fractional however there will become a stage when a lease has fewer than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the primary reason why you should consider extending sooner rather than later. Many flat owners in Killay will meet the qualifying criteria; nevertheless a conveyancing solicitor can advise whether you qualify for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years left, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| 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 be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Killay 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.
Following lengthy discussions with the landlord of her leasehold apartment in Killay, Lauren started the lease extension process as the 80 year threshold was rapidly coming. The legal work completed in July 2015. The freeholder’s fees were negotiated to a tad over 500 pounds.
Ms L Bernard completed a studio flat in Killay in February 2005. We are asked if we could approximate the premium would likely be for a 90 year extension to my lease. Comparative residencies in Killay with 100 year plus lease were worth £285,000. The mid-range amount of ground rent was £45 invoiced monthly. The lease expiry date was on 10 September 2098. Considering the 72 years unexpired we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of fees.
Last Summer we were e-mailed by Mr and Mrs. U Davis , who bought a ground floor flat in Killay in August 1997. The question was if we could approximate the premium would likely be to extend the lease by 90 years. Identical properties in Killay with 100 year plus lease were in the region of £233,200. The mid-range amount of ground rent was £60 collected annually. The lease end date was on 27 March 2087. Considering the 61 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £22,800 and £26,400 exclusive of legals.