With a long leasehold premises in Morden, you are in fact renting it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should think about a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly especially once there are less than 80 years left. Anyone in Morden with a lease nearing 81 years unexpired should seriously think of extending it as soon as possible. When a lease has under 80 years outstanding, under the current legislation the landlord is entitled to calculate and charge a greater amount, assessed on a technical computation, strangely termed as “marriage value” which is due.
Leasehold residencies in Morden with in excess of 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 handle Morden 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 conveyancing solicitor we work with provide it.
Half a year ago Teddy, came dangerously near to the eighty-year threshold with the lease on his garden flat in Morden. In buying his home 19 years ago, the lease term was of no relevance. As luck would have it, it dawned on him that he would soon be paying way over the odds for Extending the lease. Teddy extended the lease just under the wire last January. Teddy and the freeholder via the managing agents subsequently agreed on the final figure of £6,000 . If he had missed the deadline, the sum would have gone up by a minimum £1,125.
In 2014 we were contacted by Mrs Poppy James who, having acquired a purpose-built flat in Morden in June 2005. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Comparative residencies in Morden with a long lease were in the region of £280,000. The average amount of ground rent was £45 invoiced per annum. The lease ran out on 28 March 2095. Having 69 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of costs.
An example of a Lease Extension case for a Morden premises is 14 Nutwell Street in January 2014. The premium payable for the acquisition of a new lease of the subject premises was in the sum of £30,523 This case affected 1 flat. The number of years remaining on the existing lease(s) was 62.94 years.