Purley leases on domestic properties are gradually losing value. if your lease has about ninety years remaining, you should start thinking about a lease extension. Eighty years is a significant number: when the unexpired term of a lease drops below this level then you start incurring an additional element called marriage value. Flat owners in Purley will mostly qualify for a lease extension; however a solicitor will check your eligibility. In some circumstances you may not be entitled. There are also strict timetables and formalities to comply with once the process is initiated so it’s sensible to be guided by a conveyancer during the process.
Leasehold residencies in Purley with over one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Lease extensions in Purley can be a difficult process. We recommend you secure guidance from a lawyer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Purley lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
16 months ago Riley, came very near to the 80-year threshold with the lease on his two bedroom apartment in Purley. Having purchased his home twenty years previously, the unexpired term was of little interest. Fortunately, he noticed he needed to take steps soon on a lease extension. Riley extended the lease at the eleventh hour last April. Riley and the freeholder via the managing agents subsequently agreed on an amount of £5,000 . If the lease had slid lower than eighty years, the amount would have escalated by a minimum £1,000.
Last Spring we were contacted by Dr Daisy Collins , who moved into a recently refurbished flat in Purley in February 1997. The question was if we could approximate the price would be for a ninety year extension to my lease. Comparable premises in Purley with 100 year plus lease were worth £264,000. The mid-range ground rent payable was £60 collected every twelve months. The lease end date was in 2078. Having 53 years left we estimated the compensation to the landlord to extend the lease to be within £37,100 and £42,800 plus professional charges.
An example of a Freehold Enfranchisement matter before the tribunal for a Purley flat is The Woodlands 95 Purley Park Road in April 2009. The Tribunals own valuation produced the figure of £37,912. This case was in relation to 6 flats. The number of years remaining on the existing lease(s) was 78.32 years.