Why you should commence your Preston lease extension

Why you should commence your Preston lease extension today:

Increase your lease and increase your Preston property value

With a domestic leasehold premises in Preston, you effectively rent it for a certain amount of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably when there are fewer than eighty years left. Residents in Preston with a lease approaching 81 years left should seriously consider extending it without delay. When the lease term has under 80 years left, under the relevant statute the freeholder can calculate and charge a larger premium, based on a technical calculation, known as “marriage value” which is payable.

Preston property with a lease extension is almost the same value as a freehold

Leasehold residencies in Preston with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.

Lending institutions will not lend on a short lease

The trend since 2008 has been for lenders to tighten lending requirements across the board - this has extended to the types of security over which the mortgage is to be granted. This has resulted in the unexpired lease term required by mortgage companies has increased. Historically lenders were content with twenty years plus the term of the loan - routinely fifty year leases but those requirements are being increasingly undermined by the requirement for lengthy leases - many use a minimum term of 75 years as standard.

What makes us experts in Preston lease extensions?

The conveyancers that we work with undertake Preston 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 conveyancing solicitor we work with provide it.

Preston Lease Extension Example Cases:

Isabella, Preston, Lancashire,

Subsequent to protracted discussions with the freeholder of her purpose-built apartment in Preston, Isabella started the lease extension process just as the lease was nearing the all-important eighty-year deadline. The legal work was finalised in May 2009. The landlord’s charges were negotiated to below 650 pounds.

Preston case:

In 2011 we were phoned by Dr U Mercier who, having acquired a basement flat in Preston in November 2010. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparable flats in Preston with an extended lease were worth £186,000. The average amount of ground rent was £65 invoiced yearly. The lease ended on 26 November 2084. Given that there were 58 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £24,700 and £28,600 exclusive of fees.