Unfortunately that a Scotter residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Scotter property prices.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If the number of years remaining drops below eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Scotter will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your conveyancer throughout the process.
Leasehold properties in Scotter with over 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant 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. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Scotter can be a difficult process. We recommend you secure professional help from a conveyancer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Scotter lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of eight months of lengthy correspondence with the landlord of her first floor flat in Scotter, Emma initiated the lease extension process just as the lease was nearing the crucial 80-year mark. The legal work completed in July 2013. The freeholder’s fees were kept to an absolute minimum.
In 2010 we were approached by Ms Isobel Wilson who, having took over the lease of a basement flat in Scotter in September 1996. The question was if we could estimate the price would likely be to extend the lease by an additional years. Comparable flats in Scotter with a long lease were worth £270,000. The average ground rent payable was £55 collected per annum. The lease expired in 2100. Taking into account 75 years outstanding we approximated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 plus professional charges.
In 2013 we were e-mailed by Mr and Mrs. L Rivera who, having completed a purpose-built apartment in Scotter in February 2011. We are asked if we could approximate the premium would be for a 90 year lease extension. Identical properties in Scotter with an extended lease were worth £168,800. The mid-range amount of ground rent was £60 billed quarterly. The lease elapsed on 17 March 2080. Taking into account 55 years left we approximated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 not including costs.