Pensysarn residential property owned on a long lease is a wasting asset as the leaseholder merely owns the property for a period of years.
Leasehold premises in Pensysarn with in excess of 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 to be gained by buying the reversionary interest unless savings on ground rent and estate 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
The lawyers that we work with procure Pensysarn 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.
During the course of the last few months Samuel, came precariously near to the eighty-year threshold with the lease on his garden apartment in Pensysarn. Having purchased his flat twenty years previously, the unexpired term was of little interest. Thankfully, he noticed he needed to take steps soon on Extending the lease. Samuel arranged for a lease extension just in the nick of time in July. Samuel and the landlord who owned the flat above ultimately agreed on an amount of £5,000 . If the lease had gone lower than eighty years, the premium would have gone up by a minimum £1,125.
Last Summer we were phoned by Mr B Brown , who was assigned a lease of a studio apartment in Pensysarn in June 1999. We are asked if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Similar homes in Pensysarn with a long lease were valued about £275,000. The average ground rent payable was £55 billed monthly. The lease ran out on 2 January 2102. Taking into account 76 years left we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.
Last month we were approach by Mrs Abigail Lewis , who purchased a basement flat in Pensysarn in February 2006. The dilemma was if we could estimate the compensation to the landlord could be to prolong the lease by an additional years. Comparable premises in Pensysarn with 100 year plus lease were worth £176,200. The mid-range amount of ground rent was £65 billed annually. The lease finished on 6 August 2082. Having 56 years left we calculated the compensation to the freeholder for the lease extension to be within £29,500 and £34,000 plus fees.