For those whose Rainham home is held on a long lease, the message is clear – if you do nothing, the property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to procure a lease extension.
It is generally accepted that a property with in excess of 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Using our service will provide you better control over the value of your Rainham leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Owen, started to get near to the 80-year mark with the lease on his purpose- built flat in Rainham. Having purchased his home 19 years previously, the unexpired term was of no interest. Luckily, he recognised he needed to take action soon on Extending the lease. Owen extended the lease at the eleventh hour last January. Owen and the landlord ultimately settled on the final figure of £6,000 . If he not met the deadline, the figure would have become more costly by at least £875.
Last year we were phoned by Mr Ryan Bonnet , who owned a studio apartment in Rainham in September 2012. The dilemma was if we could estimate the price would be for a ninety year extension to my lease. Similar residencies in Rainham with 100 year plus lease were in the region of £265,000. The mid-range amount of ground rent was £55 billed annually. The lease came to a finish in 2100. Considering the 74 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including costs.
An example of a Lease Extension case for a Rainham property 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 unexpired residue of the current lease was 57.5 years.