Peterlee leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. It is the case that most Peterlee tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Peterlee you should investigate if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
It is generally accepted that a property with in excess of one hundred years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years left, the residence will be worth the same as a freehold for many years ahead.
Lender | Requirement |
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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; |
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. |
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. |
TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Peterlee leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of unsuccessful discussions with the freeholder of her leasehold flat in Peterlee, Rachel initiated the lease extension process just as the lease was approaching the all-important eighty-year deadline. The legal work completed in June 2015. The freeholder’s costs were negotiated to about 600 pounds.
In 2012 we were called by Dr Ibrahim Evans who, having was assigned a lease of a basement flat in Peterlee in September 2005. The question was if we could estimate the price would likely be to prolong the lease by 90 years. Comparative homes in Peterlee with a long lease were worth £280,000. The mid-range ground rent payable was £55 collected monthly. The lease finished in 2103. Having 78 years unexpired we approximated the premium to the landlord for the lease extension to be between £13,300 and £15,400 not including legals.
In 2010 we were approached by Mr and Mrs. D Ali who, having completed a basement flat in Peterlee in October 2011. The question was if we could estimate the premium would likely be to extend the lease by an additional years. Similar premises in Peterlee with 100 year plus lease were in the region of £191,000. The mid-range ground rent payable was £65 invoiced yearly. The lease finished on 7 September 2083. Considering the 58 years outstanding we approximated the compensation to the freeholder for the lease extension to be within £23,800 and £27,400 plus legals.