Shawbury leases on domestic properties are gradually losing value. Where your lease has approximately ninety years remaining, you should start thinking about a lease extension. If lease term dips under 80 years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Shawbury will mostly qualify for a lease extension; however It would be wise to check with a lawyer to check if you qualify. In certain circumstances you may not be entitled. There are prescribed deadlines and steps to comply with once the process is initiated so it’s wise to be guided by a conveyancer during the process.
Leasehold properties in Shawbury with more than one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Yorkshire 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. |
The lawyers that we work with handle Shawbury 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.
Last Spring Ibrahim, came precariously near to the 80-year threshold with the lease on his first floor apartment in Shawbury. Having bought his flat 19 years previously, the lease term was of no bearing. Thankfully, it dawned on him that he needed to take steps soon on Extending the lease. Ibrahim arranged for a lease extension just in the nick of time in August. Ibrahim and the freeholder subsequently settled on sum of £5,000 . If he not met the deadline, the price would have escalated by a minimum £975.
Dr Caleb King bought a studio apartment in Shawbury in July 2006. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparative properties in Shawbury with a long lease were worth £230,800. The average amount of ground rent was £60 invoiced annually. The lease finished on 4 July 2085. Taking into account 60 years outstanding we estimated the premium to the freeholder for the lease extension to be between £24,700 and £28,600 plus fees.
In 2009 we were e-mailed by Mr Ben White who, having was assigned a lease of a one bedroom flat in Shawbury in March 1995. The dilemma was if we could shed any light on how much (approximately) price would likely be to extend the lease by an additional years. Identical properties in Shawbury with 100 year plus lease were worth £210,000. The average amount of ground rent was £50 billed per annum. The lease expired in 2105. Having 80 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 not including professional charges.