Chances are that where you own a flat in Nelson you actually own a long leasehold interest over your property
Leasehold residencies in Nelson with more than one hundred years unexpired 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 to be gained by purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Retaining our service will provide you increased control over the value of your Nelson leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
After protracted negotiations with the freeholder of her two bedroom flat in Nelson, Phoebe commenced the lease extension process just as the lease was nearing the critical 80-year mark. The lease extension completed in September 2006. The landlord’s costs were kept to an absolute minimum.
Last year we were e-mailed by Mr and Mrs. H Thomas , who owned a ground floor flat in Nelson in March 2004. We are asked if we could estimate the premium would likely be to extend the lease by ninety years. Comparable residencies in Nelson with 100 year plus lease were valued around £235,600. The mid-range amount of ground rent was £60 billed annually. The lease lapsed on 21 March 2088. Considering the 62 years outstanding we approximated the compensation to the landlord to extend the lease to be within £21,900 and £25,200 exclusive of professional charges.
Dr H Laurent acquired a purpose-built flat in Nelson in March 2009. We are asked if we could approximate the premium would likely be for a 90 year extension to my lease. Comparative homes in Nelson with 100 year plus lease were valued about £174,200. The average ground rent payable was £55 billed quarterly. The lease end date was on 16 June 2077. Given that there were 51 years unexpired we approximated the premium to the landlord to extend the lease to be between £31,400 and £36,200 exclusive of professional charges.