With a residential leasehold premises in Newcastle under Lyme, you are actually buying a right to live in a property for a set 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 extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly especially when there are less than 80 years left. Anyone in Newcastle under Lyme with a lease nearing 81 years left should seriously consider extending it as soon as possible. When the lease term has under eighty years outstanding, under the relevant statute the landlord is entitled to calculate and demand a larger amount, based on a technical multiplication, known as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| Yorkshire 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. |
Lease extensions in Newcastle under Lyme can be a difficult process. We recommend you get professional help from a conveyancing solicitor and surveyor with experience in lease extensions.
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 in-depth market knowledge procuring Newcastle under Lyme lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of unsuccessful discussions with the freeholder of her garden flat in Newcastle under Lyme, Hannah initiated the lease extension process just as the lease was coming close to the all-important 80-year deadline. The lease extension was concluded in September 2006. The freeholder’s fees were restricted to slightly above 650 GBP.
In 2013 we were e-mailed by Dr O Walker who, having bought a recently refurbished apartment in Newcastle under Lyme in October 2005. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by 90 years. Similar homes in Newcastle under Lyme with an extended lease were in the region of £280,000. The average amount of ground rent was £45 invoiced quarterly. The lease finished in 2094. Taking into account 69 years outstanding we approximated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including legals.
Last Summer we were approach by Mr and Mrs. J Rivera , who took over the lease of a studio apartment in Newcastle under Lyme in August 2001. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by ninety years. Similar flats in Newcastle under Lyme with an extended lease were worth £216,000. The mid-range ground rent payable was £60 billed every twelve months. The lease terminated in 2083. Given that there were 58 years unexpired we calculated the premium to the landlord to extend the lease to be within £28,500 and £33,000 exclusive of professional charges.