The basic rule is, all other things holding equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Leigh have the legal entitlement to extend the lease for a further ninety years under statute. Do think carefully before delaying your Leigh lease extension. Postponing the costs today simply increases the price you will eventually be required to pay for a lease extension.
Leasehold residencies in Leigh with in excess of one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth 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 estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| 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. |
| 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 |
Regardless of whether you are a tenant or a landlord in Leigh,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Leigh valuers.
Half a year ago Eliot, came dangerously close to the eighty-year mark with the lease on his leasehold apartment in Leigh. In buying his property twenty years previously, the unexpired term was of minimal interest. Thankfully, he realised he would soon be paying an escalated premium for Extending the lease. Eliot was able to extend his lease at the eleventh hour in September. Eliot and the landlord in the end agreed on an amount of £6,000 . If he not met the deadline, the amount would have gone up by at least £1,075.
Last September we were approach by Dr K Taylor , who purchased a basement apartment in Leigh in February 2008. The question was if we could estimate the premium could be to extend the lease by 90 years. Comparative homes in Leigh with a long lease were in the region of £205,000. The average ground rent payable was £50 invoiced annually. The lease ran out in 2105. Having 79 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 not including legals.
In 2011 we were contacted by Ms I Davis who, having was assigned a lease of a one bedroom apartment in Leigh in September 2007. The dilemma was if we could approximate the compensation to the landlord could be for a ninety year extension to my lease. Comparable residencies in Leigh with a long lease were valued around £275,000. The mid-range amount of ground rent was £65 collected per annum. The lease terminated on 1 January 2094. Having 68 years unexpired we calculated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of fees.