For those whose Rhoose home is held on a long lease, the message is clear – if nothing is done, the property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to procure a lease extension.
Leasehold premises in Rhoose with more than one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
The conveyancing solicitors that we work with procure Rhoose 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.
In the wake of 9 months of unsuccessful correspondence with the freeholder of her studio apartment in Rhoose, Poppy commenced the lease extension process as the 80 year threshold was rapidly approaching. The transaction was concluded in January 2013. The freeholder’s fees were kept to an absolute minimum.
Last November we were e-mailed by Dr H Hall , who purchased a one bedroom flat in Rhoose in April 2006. We are asked if we could estimate the compensation to the landlord could be for a ninety year lease extension. Similar residencies in Rhoose with 100 year plus lease were worth £233,200. The average amount of ground rent was £60 collected per annum. The lease lapsed in 2086. Given that there were 61 years remaining we calculated the premium to the freeholder for the lease extension to be within £22,800 and £26,400 plus professional charges.
In 2010 we were e-mailed by Dr Amy Brown who, having completed a one bedroom flat in Rhoose in January 2002. The question was if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Identical premises in Rhoose with 100 year plus lease were worth £166,800. The average ground rent payable was £50 invoiced annually. The lease expired in 2075. Having 50 years remaining we approximated the compensation to the landlord to extend the lease to be between £32,300 and £37,400 plus legals.