Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Saltney. Inevitably, the period of lease left shortens as time goes by. This is often ignored and only raises itself as an issue when the property needs to be disposed of or refinanced. The shorter the lease the less it is worth and the more expensive it will be to procure a lease extension. Eligible long lease owners in Saltney have the right to extend the lease for a further 90 years under the 1993 Leasehold Reform Act. Do give due attention before putting off your Saltney lease extension. Putting off the cost now simply increases the price you will eventually have to pay to extend your lease
Leasehold residencies in Saltney with in excess of one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
The lawyers that we work with handle Saltney 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 lawyer we work with provide it.
14 months ago Gabriel, started to get near to the 80-year mark with the lease on his one bedroom apartment in Saltney. Having purchased his flat 18 years ago, the length of the lease was of no importance. by good luck, it dawned on him that he needed to take action soon on a lease extension. Gabriel arranged for a lease extension at the eleventh hour in April. Gabriel and the freeholder in the end settled on sum of £6,000 . If the lease had slipped to less than 80 years, the amount would have increased by at least £925.
Last Christmas we were called by Ms Lauren Peterson , who was assigned a lease of a one bedroom flat in Saltney in July 2005. The question was if we could shed any light on how much (roughly) price would be to prolong the lease by 90 years. Comparable homes in Saltney with an extended lease were worth £210,000. The mid-range ground rent payable was £50 billed monthly. The lease elapsed in 2105. Having 80 years unexpired we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
Mrs Poppy Rivera bought a garden apartment in Saltney in October 2007. We are asked if we could estimate the price could be to extend the lease by an additional years. Comparative residencies in Saltney with a long lease were worth £275,000. The average ground rent payable was £45 invoiced every twelve months. The lease expiry date was in 2094. Taking into account 69 years left we estimated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of expenses.