It’s a harsh certainty that a Sharnbrook 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 early years due to the deflation being disguised by increases in the Sharnbrook property market.Where your lease has approximately ninety years left, you should start considering 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 slips under 80 years - otherwise a higher amount will be payable. The majority of flat owners in Sharnbrook will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold premises in Sharnbrook with more than one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service 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. |
| 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. |
| 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. |
| 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. |
Lease extensions in Sharnbrook can be a difficult process. We recommend you get guidance from a lawyer and surveyor well versed in the legislation and lease extension process.
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 a wealth of experience dealing with Sharnbrook lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last year Teddy, started to get near to the eighty-year mark with the lease on his leasehold flat in Sharnbrook. In buying his home two decades ago, the unexpired term was of minimal significance. Thankfully, it dawned on him that he needed to take steps soon on Extending the lease. Teddy arranged for a lease extension just under the wire last July. Teddy and the landlord ultimately settled on sum of £5,000 . If the lease had slipped to less than 80 years, the premium would have become more costly by a minimum £1,025.
In 2014 we were called by Mr and Mrs. S Sánchez who, having purchased a one bedroom apartment in Sharnbrook in August 1995. The dilemma was if we could estimate the price would be to prolong the lease by a further 90 years. Identical residencies in Sharnbrook with an extended lease were valued around £184,000. The average ground rent payable was £55 invoiced monthly. The lease ran out in 2079. Having 53 years outstanding we calculated the premium to the landlord for the lease extension to be within £28,500 and £33,000 plus legals.
Mr and Mrs. D Smith bought a ground floor apartment in Sharnbrook in July 2001. The question was if we could approximate the compensation to the landlord would likely be for a 90 year lease extension. Identical flats in Sharnbrook with a long lease were worth £290,000. The average ground rent payable was £45 collected yearly. The lease concluded in 2099. Given that there were 73 years outstanding we approximated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including fees.