Raglan leases on residential deteriorating in value. Where your lease has approximately 90 years left, you should start thinking about a lease extension. It is important to recognise that it is that it is financially advisable for a lease extension to take place before the term of the current lease falls under 80 years - otherwise a higher amount will be payable. Flat owners in Raglan will mostly qualify for a lease extension; however a solicitor will check your eligibility. In some cases you may not qualify. There are prescribed deadlines and procedures to comply with once the process has started so it’s prudent to be guided by a lawyer during the process.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a freeholder in Raglan,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Raglan valuers.
In recent months Jayden, started to get close to the 80-year threshold with the lease on his purpose- built flat in Raglan. In buying his flat 19 years ago, the unexpired term was of minimal bearing. by good luck, it dawned on him that he would imminently be paying way over the odds for a lease extension. Jayden arranged for a lease extension just under the wire last May. Jayden and the freeholder via the management company subsequently settled on an amount of £6,000 . If he had missed the deadline, the amount would have gone up by a minimum £1,000.
Last Spring we were contacted by Ms G Wood , who took over the lease of a garden apartment in Raglan in November 2012. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by an additional years. Identical premises in Raglan with 100 year plus lease were in the region of £264,000. The average ground rent payable was £60 collected monthly. The lease lapsed in 2078. Considering the 53 years left we calculated the premium to the landlord for the lease extension to be between £37,100 and £42,800 plus fees.
In 2011 we were phoned by Mr and Mrs. B Clarke who, having took over the lease of a first floor flat in Raglan in October 2003. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by an additional years. Comparable properties in Raglan with an extended lease were worth £220,400. The average amount of ground rent was £45 invoiced quarterly. The lease concluded on 22 January 2089. Considering the 64 years unexpired we approximated the premium to the freeholder for the lease extension to be within £16,200 and £18,600 not including legals.