Unfortunately that a Peterborough residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Peterborough property market.Once your lease nears 85ish years, you need to start thinking about a lease extension. If the number of years remaining dips below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Peterborough will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Peterborough 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.
Two years ago Freddie, started to get near to the eighty-year threshold with the lease on his studio flat in Peterborough. Having purchased his flat 19 years ago, the unexpired term was of no interest. by good luck, it dawned on him that he needed to take steps soon on a lease extension. Freddie arranged for a lease extension just in the nick of time last July. Freddie and the freeholder ultimately agreed on an amount of £5,000 . If he failed to meet the deadline, the figure would have escalated by at least £1,100.
Last June we were e-mailed by Ms Millie Cook , who owned a studio flat in Peterborough in September 2005. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year lease extension. Similar premises in Peterborough with 100 year plus lease were valued about £173,800. The mid-range amount of ground rent was £65 collected quarterly. The lease concluded on 10 February 2081. Given that there were 55 years outstanding we estimated the premium to the landlord for the lease extension to be within £31,400 and £36,200 not including costs.
Mr Logan Stewart purchased a studio apartment in Peterborough in April 2001. We are asked if we could shed any light on how much (approximately) premium would likely be to prolong the lease by 90 years. Similar homes in Peterborough with an extended lease were worth £235,200. The average ground rent payable was £45 billed annually. The lease lapsed in 2092. Taking into account 66 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 not including professional charges.