As the the remaining lease term of a Mitcheldean domestic lease lessens so does its value and therefore the value of your property. Where the residual term has, in excess of one hundred years to run then this decrease may be fractional however there will become a stage when a lease has fewer than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main reason why you should extend the lease without delay. Most flat owners in Mitcheldean will qualify for this right; nevertheless a lawyer will be able to confirm if you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold premises in Mitcheldean with over 100 years left on the lease are often 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 upside in buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a freeholder in Mitcheldean,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Mitcheldean valuers.
In the wake of 6 months of lengthy correspondence with the freeholder of her garden flat in Mitcheldean, Lydia started the lease extension process as the eighty year mark was fast nearing. The legal work was finalised in September 2014. The landlord’s charges were kept to an absolute minimum.
In 2010 we were phoned by Dr D Jones who, having purchased a basement apartment in Mitcheldean in July 2005. The dilemma was if we could approximate the price could be for a ninety year lease extension. Comparable homes in Mitcheldean with a long lease were worth £176,200. The mid-range amount of ground rent was £65 billed quarterly. The lease came to a finish in 2082. Taking into account 56 years outstanding we approximated the premium to the landlord for the lease extension to be between £29,500 and £34,000 exclusive of costs.
Mr and Mrs. T Flores owned a basement apartment in Mitcheldean in September 2011. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by ninety years. Comparative properties in Mitcheldean with an extended lease were worth £242,600. The average amount of ground rent was £45 collected yearly. The lease terminated in 2093. Considering the 67 years as a residual term we approximated the premium to the freeholder for the lease extension to be between £11,400 and £13,200 not including legals.