Maldon Lease Extension - Free Consultation

Before you progress with your lease extension in Maldon
Get a quote from one of our lease extension experts with over 20 years experience.

Let them guide you for FREE on the various options available to you.

It may end up saving you thousands.

Main reasons to commence your Maldon lease extension


Why you should commence your Maldon lease extension today:

Increase your lease and increase your Maldon property value

The market value of a leasehold property in Maldon depends on how many years the lease has remaining. If it is close to or fewer than 80 years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. Ideally one should start the lease extension process when a lease still has 82 years unexpired so that a lease extension can be finalised prior to the 80 year threshold. Leasehold Reform legislation entitles Maldon qualifying lessees to an additional term of 90 years over and above the remaining term, at a peppercorn rent (no ground rent). The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.

An extended lease is almost the same value as a freehold

It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.

Lenders may decide not to loan monies with a short lease

Whether or not the lease is be regarded as a short lease varies by mortgage company, yet mortgage lenders start to get nervous at around 75 years. This may cause difficulties when you wish to dispose of or refinance your flat as it will be effectively unmortgageable. Even though you may not have an imminent plan to sell but when you do your purchaser will have to wait a couple of years before being able to initiate the legal procedures for a lease extension.

Lender Requirement
Barnsley Building Society 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term.
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.
Leeds Building Society 85 years remaining from the start of the mortgage.
Nationwide Building Society - Our minimum unexpired lease term is 55 years, except where lending is over 85% of the purchase price/valuation on a second hand flat, in which case our minimum unexpired term is 90 years.
- There must be at least 30 years remaining at the end of the mortgage term (regardless of the length of lease at the start).

Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:

Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
- Where lending is over 85% of the purchase price/valuation on a second hand flat and the unexpired lease term on the offer is 90 years or more - only advise us if the actual lease term is less than 90 years.

New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer

Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.

SECOND HAND PROPERTIES

Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 55 years
- Unexpired lease term less than 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period is less than or equal to 5 years

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 55 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial, etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years (Minimum 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat)
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI

NEW BUILD PROPERTIES (includes office conversions)

Unacceptable - advise Issuing Office (Will be declined)
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house (does not apply to Shared Ownership)
- Any lease which is subject to a Ground Rent (or Annual Rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a Ground Rent (or Annual Rent) being charged which is more than on a peppercorn basis

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn Ground Rent (Annual Rent) charges

For the avoidance of doubt, any New Build properties completed but not sold pre-30 June 2022 will only be acceptable if the Lease conforms to the above guidance.

* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years.

Lease Extensions

We require all Lease Extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where you become aware that it does not meet these requirements, please refer to Issuing Office.
Virgin 85 years at the time of completion. If it's less, we require it to be extended on or before completion.

Why use us for your lease extension in Maldon?

Using our service gives you enhanced control over the value of your Maldon leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.

Maldon Lease Extension Case Studies:

Rachel, Maldon, Essex,

After unsuccessful negotiations with the freeholder of her first floor apartment in Maldon, Rachel initiated the lease extension process as the eighty year threshold was fast coming. The lease extension completed in November 2005. The freeholder’s fees were negotiated to under 700 pounds.

Maldon case:

In 2013 we were contacted by Mrs O Phillips who, having completed a purpose-built flat in Maldon in January 2004. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Identical flats in Maldon with 100 year plus lease were worth £280,000. The average ground rent payable was £55 collected quarterly. The lease end date was in 2101. Taking into account 77 years outstanding we calculated the premium to the freeholder for the lease extension to be within £13,300 and £15,400 not including professional charges.

Maldon case:

Dr I Nelson acquired a garden apartment in Maldon in January 1998. The question was if we could approximate the premium would be for a 90 year extension to my lease. Identical flats in Maldon with a long lease were in the region of £183,600. The average amount of ground rent was £65 invoiced annually. The lease ran out on 9 May 2081. Having 57 years as a residual term we calculated the premium to the landlord for the lease extension to be between £28,500 and £33,000 plus professional charges.