Unfortunately that a Mildmay residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Mildmay property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If lease term dips under 80 years, you will end up paying half 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 flat owners in Mildmay will be able to extend under the legislation; however a lawyer should be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold premises in Mildmay with in excess of one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
The conveyancing solicitors that we work with undertake Mildmay 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 conveyancer we work with provide it.
Logan owned a conversion apartment in Mildmay being sold with a lease of a little over fifty eight years left. Logan on an informal basis spoke with his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Logan to invoke his statutory right. Logan obtained expert advice and secured an acceptable resolution informally and ending up with a market value flat.
Mr and Mrs. K Wilson purchased a basement flat in Mildmay in June 2004. The question was if we could shed any light on how much (roughly) premium could be to prolong the lease by 90 years. Comparable premises in Mildmay with a long lease were valued around £181,600. The average ground rent payable was £55 billed monthly. The lease expiry date was on 11 September 2078. Considering the 52 years outstanding we approximated the premium to the freeholder to extend the lease to be within £30,400 and £35,200 not including legals.
Mr and Mrs. N David purchased a ground floor flat in Mildmay in June 2005. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Similar flats in Mildmay with 100 year plus lease were in the region of £290,000. The average amount of ground rent was £45 billed annually. The lease ran out on 11 April 2098. Having 72 years remaining we estimated the compensation to the freeholder to extend the lease to be within £11,400 and £13,200 exclusive of legals.