When it comes to residential leasehold premises in Low Fell, you effectively rent it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably when there are less than 80 years left. Leasehold owners in Low Fell with a lease nearing 81 years remaining should seriously think of extending it without delay. Once the lease term has fewer than 80 years outstanding, under the current legislation the landlord is entitled to calculate and charge a larger premium, assessed on a technical multiplication, known as “marriage value” which is due.
Leasehold residencies in Low Fell with over one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
Using our service gives you enhanced control over the value of your Low Fell leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Oscar, started to get near to the 80-year threshold with the lease on his basement flat in Low Fell. Having purchased his property 18 years previously, the length of the lease was of no interest. As luck would have it, he realised he would soon be paying an escalated premium for Extending the lease. Oscar was able to extend his lease just ahead of time in March. Oscar and the freeholder via the management company ultimately agreed on the final figure of £5,500 . If the lease had dipped lower than 80 years, the figure would have become more exhorbitant by a minimum £975.
In 2014 we were approached by Ms Eleanor Ali who, having was assigned a lease of a garden flat in Low Fell in October 2005. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by an additional years. Identical properties in Low Fell with an extended lease were valued around £189,000. The mid-range amount of ground rent was £55 billed quarterly. The lease ran out on 3 July 2079. Having 53 years unexpired we approximated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of costs.
In 2010 we were called by Dr R André who, having was assigned a lease of a first floor apartment in Low Fell in January 2004. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Identical homes in Low Fell with 100 year plus lease were in the region of £290,000. The average amount of ground rent was £45 invoiced per annum. The lease ran out in 2099. Having 73 years outstanding we calculated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of legals.