For those whose Old Woking property is held on a long lease, the message is clear – if you ignore the situation, your property will eventually revert to the freeholder, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to obtain a lease extension.
It is generally accepted that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
The lawyers that we work with procure Old Woking 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 conveyancing solicitor we work with provide it.
Subsequent to protracted negotiations with the freeholder of her leasehold apartment in Old Woking, Victoria started the lease extension process just as her lease was coming close to the all-important 80-year mark. The legal work completed in March 2010. The freeholder’s charges were restricted to approximately 550 GBP.
In 2010 we were called by Mr H Rogers who, having acquired a ground floor apartment in Old Woking in January 2005. We are asked if we could shed any light on how much (roughly) price could be to prolong the lease by 90 years. Similar residencies in Old Woking with 100 year plus lease were in the region of £196,400. The mid-range ground rent payable was £55 invoiced yearly. The lease finished in 2079. Given that there were 54 years outstanding we calculated the premium to the freeholder to extend the lease to be between £35,200 and £40,600 exclusive of legals.
Last Winter we were phoned by Mr Ryan Thomas , who was assigned a lease of a newly refurbished flat in Old Woking in May 1999. The dilemma was if we could estimate the compensation to the landlord would be to extend the lease by 90 years. Identical flats in Old Woking with a long lease were valued around £295,000. The average ground rent payable was £45 collected annually. The lease finished on 7 May 2100. Having 75 years outstanding we approximated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 not including fees.