Rainham leases on domestic deteriorating in value. if your lease has about 90 years remaining, you should start thinking about a lease extension. 80 years is a significant number: when the remaining term of a lease dips below this level then you begin paying an additional element called marriage value. Flat owners in Rainham will usually qualify for a lease extension; however a solicitor should be able check your eligibility. In certain cases you may not qualify. There are also strict timetables and steps to comply with once the process is triggered so it’s wise to be guided by a conveyancer during the process.
Leasehold properties in Rainham with over one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Birmingham Midshires | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a landlord in Rainham,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 Rainham valuers.
David owned a 2 bedroom apartment in Rainham being sold with a lease of just over 72 years outstanding. David on an informal basis spoke with his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £200 annually. Ordinarily, ground rent would not be due on a lease extension were David to exercise his statutory right. David obtained expert legal guidance and secured satisfactory resolution informally and ending up with a market value flat.
In 2012 we were e-mailed by Dr Jonathan Hall who, having moved into a first floor flat in Rainham in July 2011. The question was if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Comparable residencies in Rainham with an extended lease were worth £254,200. The average amount of ground rent was £60 collected quarterly. The lease finished in 2077. Considering the 51 years outstanding we calculated the premium to the landlord to extend the lease to be between £43,700 and £50,600 exclusive of costs.
An example of a Lease Extension matter before the tribunal 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 unexpired lease term was 57.5 years.