Chances are that where you own a flat in Shelfield you actually own a long leasehold interest over your property
Leasehold premises in Shelfield with in excess of 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 premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| 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 conveyancing solicitors that we work with procure Shelfield 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 conveyancer we work with provide it.
Jamie was the the leasehold proprietor of a studio flat in Shelfield being sold with a lease of a little over 61 years outstanding. Jamie on an informal basis contacted his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £100 per annum. No ground rent would be due on a lease extension were Jamie to exercise his statutory right. Jamie procured expert advice and secured satisfactory deal informally and readily saleable.
Last Autumn we were phoned by Mr and Mrs. O Thompson , who completed a basement apartment in Shelfield in November 1996. The question was if we could estimate the price would be to prolong the lease by 90 years. Comparative flats in Shelfield with an extended lease were worth £285,000. The average ground rent payable was £45 billed quarterly. The lease expiry date was on 5 May 2096. Having 71 years unexpired we calculated the premium to the landlord to extend the lease to be between £12,400 and £14,200 not including legals.
Last Spring we were contacted by Mr and Mrs. O Campbell , who moved into a newly refurbished apartment in Shelfield in July 2005. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Comparative residencies in Shelfield with 100 year plus lease were valued around £225,800. The average ground rent payable was £60 invoiced per annum. The lease came to a finish on 11 September 2085. Taking into account 60 years outstanding we approximated the compensation to the landlord to extend the lease to be between £23,800 and £27,400 not including professional charges.