When it comes to domestic leasehold premises in Little Mill, you effectively rent it for a certain period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are less than 80 years left. Leasehold owners in Little Mill with a lease approaching 81 years left should seriously think of extending it sooner as opposed to later. Once a lease has less than eighty years remaining, under the current legislation the freeholder can calculate and levy a larger amount, based on a technical multiplication, strangely termed as “marriage value” which is due.
It is generally accepted that a property with in excess of 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
The conveyancers that we work with procure Little Mill 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 conveyancing solicitor we work with provide it.
Matthew owned a conversion flat in Little Mill on the market with a lease of a little over 61 years unexpired. Matthew informally contacted his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £100 per annum. Ordinarily, ground rent would not be payable on a lease extension were Matthew to exercise his statutory right. Matthew procured expert advice and secured satisfactory deal without going to tribunal and ending up with a market value flat.
Mr and Mrs. M Thompson completed a basement flat in Little Mill in November 2004. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by an additional years. Comparable flats in Little Mill with 100 year plus lease were worth £275,000. The mid-range amount of ground rent was £45 billed quarterly. The lease expired in 2095. Given that there were 69 years outstanding we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of professional charges.
Mr and Mrs. I Hall was assigned a lease of a first floor apartment in Little Mill in September 2005. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Comparable premises in Little Mill with 100 year plus lease were worth £216,000. The average ground rent payable was £60 collected yearly. The lease expired on 9 April 2084. Taking into account 58 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 exclusive of professional charges.