Owning a apartment usually means owning a lease of the property, which has a set term of years. This lease will usually be granted for a set period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Nettleham. Inevitably, the term of lease remaining shortens as time goes by. This is often overlooked and only becomes a problem when the residence needs to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible long lease owners in Nettleham have the right to extend the lease for an additional ninety years under the 1993 Leasehold Reform Act. You should give careful consideration before putting off your Nettleham lease extension. Putting off the cost now likely increases the price you will ultimately incur for a lease extension
Leasehold residencies in Nettleham with more than one hundred 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 maintenance charges justify 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service will provide you enhanced control over the value of your Nettleham leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Theo owned a conversion apartment in Nettleham on the market with a lease of just over 72 years unexpired. Theo on an informal basis contacted his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Theo to exercise his statutory right. Theo procured expert legal guidance and secured satisfactory resolution without going to tribunal and ending up with a market value flat.
In 2009 we were contacted by Mrs Lydia Robinson who, having took over the lease of a basement flat in Nettleham in August 1999. The dilemma was if we could estimate the price would likely be for a ninety year lease extension. Similar residencies in Nettleham with a long lease were worth £173,800. The average amount of ground rent was £60 invoiced every twelve months. The lease terminated on 3 September 2081. Given that there were 55 years remaining we estimated the premium to the freeholder to extend the lease to be between £31,400 and £36,200 plus professional charges.
In 2013 we were e-mailed by Mr J Edwards who, having was assigned a lease of a studio apartment in Nettleham in March 2006. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Similar premises in Nettleham with an extended lease were in the region of £235,200. The average ground rent payable was £45 billed quarterly. The lease expired in 2092. Given that there were 66 years left we estimated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of fees.