For anyone whose Penzance home is held on a long lease, our message is clear – if no remedial action is taken, the property will ultimately revert to the freeholder, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more it will cost to procure a lease extension.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
The conveyancers that we work with procure Penzance 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.
Last year Elijah, started to get near to the eighty-year threshold with the lease on his leasehold apartment in Penzance. In buying his home two decades ago, the length of the lease was of minimal significance. Luckily, he realised he needed to take action soon on a lease extension. Elijah extended the lease just under the wire in July. Elijah and the landlord ultimately settled on an amount of £6,000 . If the lease had slipped lower than eighty years, the sum would have gone up by a minimum £1,125.
Mr C André bought a garden apartment in Penzance in April 2007. We are asked if we could estimate the price would be to extend the lease by a further 90 years. Comparative homes in Penzance with 100 year plus lease were worth £176,200. The mid-range ground rent payable was £65 invoiced quarterly. The lease lapsed on 7 October 2081. Having 56 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £29,500 and £34,000 exclusive of costs.
Mr and Mrs. N Wilson owned a one bedroom apartment in Penzance in July 1999. We are asked if we could approximate the compensation to the landlord would be for a ninety year lease extension. Identical properties in Penzance with an extended lease were worth £237,600. The mid-range ground rent payable was £45 billed yearly. The lease came to a finish on 16 October 2092. Given that there were 67 years outstanding we calculated the premium to the landlord for the lease extension to be between £11,400 and £13,200 exclusive of expenses.