Unfortunately that a Sevenoaks residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Sevenoaks property market.Where your lease has approximately 90 years left, you need to 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 falls under eighty years - otherwise a higher premium will be payable. Most flat owners in Sevenoaks will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold residencies in Sevenoaks with more than one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| 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 conveyancers that we work with procure Sevenoaks 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.
Trailing unsuccessful correspondence with the freeholder of her two bedroom apartment in Sevenoaks, Katie started the lease extension process as the 80 year mark was rapidly approaching. The transaction was concluded in January 2007. The landlord’s fees were kept to an absolute minimum.
Dr Henry Williams bought a ground floor apartment in Sevenoaks in August 1998. The dilemma was if we could shed any light on how much (roughly) price could be for a 90 year extension to my lease. Comparative homes in Sevenoaks with 100 year plus lease were valued about £246,800. The average ground rent payable was £60 invoiced yearly. The lease terminated in 2076. Taking into account 50 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £44,700 and £51,600 not including professional charges.
Last Spring we were phoned by Mr and Mrs. F Phillips , who acquired a recently refurbished apartment in Sevenoaks in August 2009. The dilemma was if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Comparable premises in Sevenoaks with a long lease were worth £203,200. The average ground rent payable was £65 invoiced yearly. The lease expired on 15 February 2087. Having 61 years left we approximated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 exclusive of legals.