With a residential leasehold property in Old Ford, you are actually buying an entitlement to live in a property for a set period of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you may think about extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive notably when there are fewer than eighty years left. Residents in Old Ford with a lease nearing 81 years unexpired should seriously think of extending it without delay. Once the lease term has less than 80 years left, under the relevant legislation the landlord can calculate and charge a larger premium, based on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold properties in Old Ford with in excess of 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 property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancing solicitors that we work with undertake Old Ford 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 conveyancer we work with provide it.
Tyler was the the leasehold proprietor of a 2 bedroom flat in Old Ford being sold with a lease of a little over fifty eight years outstanding. Tyler on an informal basis contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 per annum. No ground rent would be due on a lease extension were Tyler to invoke his statutory right. Tyler procured expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
In 2010 we were e-mailed by Dr E Moore who, having completed a basement apartment in Old Ford in June 2012. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by ninety years. Comparable flats in Old Ford with an extended lease were worth £254,200. The mid-range amount of ground rent was £60 collected quarterly. The lease came to a finish on 11 April 2076. Having 51 years outstanding we calculated the premium to the landlord for the lease extension to be between £43,700 and £50,600 plus costs.
An example of a Freehold Enfranchisement case for a Old Ford premises is 26 Rhondda Grove in June 2009. The net price payable by the leaseholders as determined by the Tribunal was £3,015.13. This comprised £11,300 premium for the reversion less £8,284.87 costs as ordered by the County Court.