With a residential leasehold property in Royton, you are actually buying a right to reside in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are fewer than 80 years left. Leasehold owners in Royton with a lease nearing 81 years remaining should seriously think of extending it as soon as possible. When a lease has under 80 years left, under the current statute the freeholder is entitled to calculate and charge a larger premium, assessed on a technical computation, known as “marriage value” which is payable.
Leasehold premises in Royton with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges justify 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with procure Royton 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 conveyancer we work with provide it.
In recent months Luke, started to get near to the 80-year threshold with the lease on his two bedroom flat in Royton. In buying his home two decades ago, the lease term was of little concern. by good luck, he recognised he needed to take steps soon on Extending the lease. Luke was able to extend his lease at the eleventh hour in July. Luke and the freeholder ultimately agreed on a premium of £6,000 . If the lease had dipped below eighty years, the sum would have escalated by at least £925.
Last Autumn we were e-mailed by Dr Oscar Rodríguez , who bought a garden flat in Royton in November 2002. The dilemma was if we could estimate the premium would likely be to extend the lease by an additional years. Similar residencies in Royton with an extended lease were valued around £257,800. The average amount of ground rent was £65 collected per annum. The lease elapsed on 12 October 2090. Having 65 years remaining we approximated the premium to the freeholder to extend the lease to be between £18,100 and £20,800 plus legals.
Last Summer we were contacted by Mr and Mrs. A Morris , who owned a purpose-built flat in Royton in June 2000. The dilemma was if we could estimate the premium would likely be for a 90 year extension to my lease. Identical properties in Royton with 100 year plus lease were valued about £196,400. The average amount of ground rent was £55 collected annually. The lease expiry date was in 2079. Considering the 54 years left we calculated the premium to the freeholder for the lease extension to be within £35,200 and £40,600 plus costs.