Unfortunately that a Kimbolton residential lease is a wasting asset. As the lease term reduces so does the value of the property. 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 Kimbolton property market.Once your lease gets to 85ish years, 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 falls below eighty years - otherwise a higher premium will be due. Most flat owners in Kimbolton will be able to extend under the legislation; however a lawyer will be able to confirm whether you are eligibility. In some cases you may not qualify. 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 lawyer from beginning to end of the formalities.
It is generally accepted that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Kimbolton 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.
Following lengthy discussions with the landlord of her purpose-built apartment in Kimbolton, Shannon started the lease extension process just as her lease was nearing the critical 80-year threshold. The legal work was finalised in September 2015. The landlord’s charges were kept to an absolute minimum.
In 2012 we were contacted by Dr Andrew García who, having took over the lease of a garden flat in Kimbolton in June 2008. The question was if we could estimate the compensation to the landlord could be to prolong the lease by an additional years. Comparative properties in Kimbolton with an extended lease were in the region of £275,000. The mid-range ground rent payable was £65 collected annually. The lease came to a finish in 2094. Considering the 68 years remaining we estimated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of fees.
In 2012 we were contacted by Mr and Mrs. F Williams who, having bought a basement flat in Kimbolton in June 1995. We are asked if we could approximate the price could be for a ninety year extension to my lease. Comparable homes in Kimbolton with 100 year plus lease were valued around £208,600. The mid-range ground rent payable was £60 invoiced monthly. The lease expiry date was on 6 February 2083. Taking into account 57 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £30,400 and £35,200 exclusive of professional charges.