For those whose Shinfield home is held on a long lease, the message is clear – if no remedial action is taken, your property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to extend the lease.
Leasehold properties in Shinfield with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service gives you better control over the value of your Shinfield leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Dexter owned a 2 bedroom apartment in Shinfield being sold with a lease of a little over fifty eight years unexpired. Dexter on an informal basis approached his freeholder a well known Manchester-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 per annum. No ground rent would be due on a lease extension were Dexter to exercise his statutory right. Dexter obtained expert legal guidance and was able to make an informed decision and deal with the matter and readily saleable.
In 2014 we were called by Dr W Taylor who, having purchased a one bedroom flat in Shinfield in October 2008. We are asked if we could approximate the premium would be to prolong the lease by 90 years. Comparative flats in Shinfield with a long lease were in the region of £191,000. The mid-range amount of ground rent was £65 billed monthly. The lease lapsed in 2084. Considering the 58 years unexpired we approximated the premium to the freeholder to extend the lease to be between £23,800 and £27,400 plus fees.
Mr and Mrs. K Baker acquired a newly refurbished flat in Shinfield in July 2002. We are asked if we could approximate the price would be to prolong the lease by an additional years. Identical flats in Shinfield with 100 year plus lease were in the region of £250,000. The average amount of ground rent was £50 billed quarterly. The lease ended in 2095. Having 69 years left we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.