For those whose Padstow property is held on a long lease, our message is clear – if no remedial action is taken, the property will ultimately revert to your landlord, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more it will cost to extend the lease.
Leasehold premises in Padstow with in excess of one hundred years left on the lease are sometimes 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 to be gained by buying the reversionary interest 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. |
| Coventry Building Society | 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. |
| 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 conveyancers that we work with handle Padstow 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.
James owned a high value flat in Padstow on the market with a lease of a few days over fifty eight years remaining. James informally approached his landlord being a well known London-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £200 yearly. No ground rent would be due on a lease extension were James to exercise his statutory right. James procured expert advice and secured an acceptable resolution without resorting to tribunal and readily saleable.
In 2012 we were called by Mr and Mrs. K Martin who, having was assigned a lease of a newly refurbished apartment in Padstow in July 2004. The dilemma was if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Similar residencies in Padstow with an extended lease were valued around £171,800. The average amount of ground rent was £55 collected yearly. The lease expired in 2076. Given that there were 50 years remaining we approximated the premium to the freeholder for the lease extension to be within £33,300 and £38,400 not including legals.
Last Spring we were approach by Mr and Mrs. N Turner , who completed a recently refurbished apartment in Padstow in February 1995. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year extension to my lease. Comparable premises in Padstow with an extended lease were valued around £280,000. The average ground rent payable was £45 invoiced annually. The lease expired in 2096. Having 70 years unexpired we estimated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 plus fees.