Unfortunately that a Maryland residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Maryland property market.Where your lease has approximately 90 years left, you need to start considering a lease extension. If lease term drops below eighty years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Maryland will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer throughout the process.
Leasehold residencies in Maryland with more than one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Maryland,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Maryland valuers.
Last October Jonathan, came perilously close to the eighty-year threshold with the lease on his ground floor flat in Maryland. In buying his property two decades ago, the unexpired term was of no importance. Luckily, it dawned on him that he needed to take steps soon on Extending the lease. Jonathan arranged for a lease extension just ahead of time in March. Jonathan and the freeholder subsequently agreed on a premium of £5,000 . If the lease had gone below eighty years, the premium would have become more costly by a minimum £1,125.
In 2013 we were phoned by Dr G Green who, having purchased a garden flat in Maryland in July 2000. The question was if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Comparative flats in Maryland with a long lease were worth £240,600. The mid-range amount of ground rent was £65 invoiced quarterly. The lease expiry date was on 5 June 2088. Having 62 years left we calculated the premium to the landlord to extend the lease to be between £21,900 and £25,200 not including professional charges.
An example of a Lease Extension case for a Maryland flat is 151A Ham Park Road in May 2010. The matter came before the Tribunal by way of a vesting order made on 12 June 2009 Deputy District Judge Coonan in Bow County Court. The tribunal decided that the sum payable for the m to be paid for the lease extension was £21,445 This case affected 1 flat.