The closer a residential lease in Morden nears to zero years unexpired, the the greater the reduction in the value of the property. Where the residual term has, over one hundred years remaining then this decrease may be of little impact that being said there will become a point in time when a lease has less than eighty years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main rational as to why you should extend the lease without delay. Most flat owners in Morden will qualify for this right; however a conveyancer can advise if you qualify for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for under two years.
Leasehold premises in Morden with more than one hundred years remaining on the lease are often regarded as a ‘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 maintenance charges merit it.
| 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. |
| 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. |
| 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. |
| 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. |
Lease extensions in Morden can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Morden lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Subsequent to lengthy correspondence with the freeholder of her two bedroom flat in Morden, Niamh started the lease extension process just as her lease was nearing the crucial eighty-year threshold. The transaction was finalised in October 2008. The freeholder’s costs were kept to an absolute minimum.
Last Winter we were called by Mr and Mrs. E Thompson , who took over the lease of a newly refurbished flat in Morden in November 2007. The question was if we could approximate the premium would be for a ninety year extension to my lease. Comparable premises in Morden with an extended lease were valued around £205,000. The average amount of ground rent was £50 billed monthly. The lease came to a finish in 2105. Taking into account 79 years remaining we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 plus legals.
An example of a Lease Extension case for a Morden residence 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 related to 1 flat. The unexpired lease term was 62.94 years.