Rainham leases on residential properties are gradually decreasing in 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 Rainham tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Rainham you must check if your lease has between 70 and 90 years remaining. There are compelling reasons why a Rainham flat owner with a lease having around eighty years unexpired should take steps to ensure that a lease extension is put in place without delay
Leasehold premises in Rainham with more than one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with undertake Rainham 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.
Off the back of protracted correspondence with the landlord of her one bedroom apartment in Rainham, Georgia commenced the lease extension process as the 80 year deadline was rapidly approaching. The lease extension was concluded in May 2010. The freeholder’s fees were negotiated to a tad over 500 pounds.
Last Summer we were approach by Dr B Anderson , who moved into a basement flat in Rainham in August 2009. We are asked if we could approximate the compensation to the landlord would be to extend the lease by ninety years. Comparable homes in Rainham with 100 year plus lease were worth £285,000. The average ground rent payable was £55 invoiced yearly. The lease termination date was in 2104. Considering the 79 years left we calculated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of legals.
An example of a Lease Extension decision for a Rainham flat is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case related to 1 flat. The remaining number of years on the lease was 57.5 years.