Moreton leases on residential deteriorating in value. if your lease has approximately 90 years left, you should start thinking about a lease extension. If lease term is under eighty years, you will then have to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Moreton will mostly be legally entitled to a lease extension; however It would be wise to check with a conveyancer to check your eligibility. In certain situations you may not qualify. There are prescribed timetables and procedures to comply with once the process has started so it’s sensible to be guided by a conveyancing solicitor during the process.
Leasehold properties in Moreton with in excess of 100 years left on the lease are sometimes 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 to be gained by buying the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you better control over the value of your Moreton leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Henry, came perilously near to the 80-year mark with the lease on his one bedroom flat in Moreton. In buying his flat twenty years ago, the lease term was of minimal significance. Fortunately, he recognised he would soon be paying way over the odds for a lease extension. Henry was able to extend his lease at the eleventh hour in September. Henry and the landlord who owned the flat above eventually settled on an amount of £6,000 . If he failed to meet the deadline, the figure would have become more exhorbitant by a minimum £1,125.
Last Spring we were contacted by Mr F Jones , who purchased a ground floor flat in Moreton in May 2012. The question was if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Identical flats in Moreton with a long lease were worth £280,000. The average amount of ground rent was £55 billed every twelve months. The lease lapsed in 2103. Taking into account 78 years unexpired we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus fees.
In 2009 we were e-mailed by Ms Katherine Murphy who, having owned a ground floor apartment in Moreton in June 1998. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by a further 90 years. Similar flats in Moreton with 100 year plus lease were in the region of £186,000. The average amount of ground rent was £65 billed yearly. The lease came to a finish on 18 March 2083. Considering the 58 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £24,700 and £28,600 exclusive of costs.