There is no doubt about it a leasehold property in Sandhurst is a wasting asset as a result of the diminishing lease term. Where the lease has, more than one hundred years to run then this decrease may be fractional however there will become a point in time when a lease has under than 80 years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the primary logic behind why you should consider extending without delay. Most flat owners in Sandhurst will qualify for this right; however a conveyancer will be able to advise if you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold residencies in Sandhurst with over 100 years unexpired on the lease are often 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 estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| Godiva Mortgages | 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with handle Sandhurst 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.
Subsequent to unsuccessful discussions with the freeholder of her purpose-built apartment in Sandhurst, Sarah commenced the lease extension process just as her lease was nearing the critical eighty-year threshold. The legal work was finalised in May 2014. The freeholder’s fees were kept to an absolute minimum.
In 2009 we were e-mailed by Mr and Mrs. K Lefebvre who, having completed a one bedroom flat in Sandhurst in May 1998. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year extension to my lease. Comparable residencies in Sandhurst with 100 year plus lease were valued around £295,000. The mid-range ground rent payable was £45 billed every twelve months. The lease expiry date was in 2099. Having 74 years remaining we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of expenses.
Last Spring we were contacted by Mr B Cook , who moved into a basement apartment in Sandhurst in November 1996. We are asked if we could approximate the price would likely be to prolong the lease by a further 90 years. Similar homes in Sandhurst with 100 year plus lease were worth £243,000. The mid-range amount of ground rent was £65 invoiced per annum. The lease lapsed in 2088. Given that there were 63 years outstanding we approximated the premium to the landlord for the lease extension to be within £20,000 and £23,000 not including fees.