It’s an underpublicised truth that a Saffron Walden residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Saffron Walden property market.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Saffron Walden will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold residencies in Saffron Walden with in excess of 100 years outstanding on the lease are sometimes 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 purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with handle Saffron Walden 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.
After protracted correspondence with the freeholder of her basement flat in Saffron Walden, Isabel commenced the lease extension process just as the lease was coming close to the all-important eighty-year mark. The transaction was finalised in June 2013. The freeholder’s costs were kept to an absolute minimum.
Mrs Harriet Brooks owned a one bedroom apartment in Saffron Walden in October 1999. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by a further 90 years. Comparative residencies in Saffron Walden with 100 year plus lease were worth £264,000. The mid-range ground rent payable was £60 collected per annum. The lease ran out in 2079. Considering the 53 years as a residual term we approximated the premium to the landlord for the lease extension to be within £37,100 and £42,800 not including expenses.
In 2012 we were e-mailed by Dr Noah Moore who, having owned a garden flat in Saffron Walden in March 1999. The question was if we could approximate the price would be to prolong the lease by 90 years. Comparative premises in Saffron Walden with a long lease were valued about £220,400. The average ground rent payable was £45 collected every twelve months. The lease lapsed in 2090. Considering the 64 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £15,200 and £17,600 plus expenses.