Unfortunately that a Nuthall residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Nuthall property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher premium will be due. Most leasehold owners in Nuthall will be able to extend under the legislation; however a lawyer will be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold properties in Nuthall with over one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges merit it.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Nuthall lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
In recent months Jackson, came critically close to the eighty-year threshold with the lease on his two bedroom apartment in Nuthall. Having purchased his home 18 years ago, the lease term was of no importance. As luck would have it, he realised he would imminently be paying way over the odds for a lease extension. Jackson arranged for a lease extension just under the wire last January. Jackson and the freeholder subsequently agreed on sum of £5,500 . If he not met the deadline, the premium would have escalated by a minimum £1,000.
Dr Harrison Gray completed a purpose-built apartment in Nuthall in March 2012. The dilemma was if we could estimate the premium would be to prolong the lease by a further 90 years. Comparative residencies in Nuthall with 100 year plus lease were valued about £191,000. The average amount of ground rent was £65 collected every twelve months. The lease finished in 2084. Given that there were 58 years left we calculated the premium to the landlord for the lease extension to be within £23,800 and £27,400 not including expenses.
In 2010 we were e-mailed by Mr and Mrs. N Nelson who, having owned a purpose-built flat in Nuthall in October 2010. We are asked if we could approximate the premium would likely be for a 90 year lease extension. Similar residencies in Nuthall with an extended lease were in the region of £250,000. The mid-range amount of ground rent was £50 billed per annum. The lease ended in 2095. Taking into account 69 years outstanding we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including fees.