Shiremoor leases on residential properties are gradually losing value. Where your lease has about 90 years left, you should start considering the need for a lease extension. 80 years is a significant number: when the unexpired term of a lease dips below this level then you begin paying an additional element called marriage value. Leasehold owners in Shiremoor will mostly qualify for a lease extension; however a solicitor will check if you qualify. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process is initiated so it’s best to be guided by a lawyer during the process.
Leasehold residencies in Shiremoor with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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 undertake Shiremoor 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 conveyancing solicitor we work with provide it.
18 months ago Isaac, started to get close to the 80-year threshold with the lease on his one bedroom flat in Shiremoor. Having bought his property twenty years previously, the length of the lease was of little significance. by good luck, he recognised he would imminently be paying way over the odds for a lease extension. Isaac was able to extend his lease just under the wire last March. Isaac and the freeholder via the management company subsequently agreed on the final figure of £5,500 . If the lease had descended lower than 80 years, the premium would have gone up by a minimum £1,100.
Last Christmas we were phoned by Mr and Mrs. N Nguyen , who was assigned a lease of a basement apartment in Shiremoor in April 2005. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Similar homes in Shiremoor with a long lease were in the region of £300,000. The average ground rent payable was £50 billed annually. The lease finished on 18 November 2101. Considering the 75 years outstanding we approximated the premium to the landlord for the lease extension to be between £9,500 and £11,000 plus fees.
Last year we were contacted by Dr Catherine Clarke , who owned a one bedroom apartment in Shiremoor in November 2003. We are asked if we could estimate the compensation to the landlord could be to extend the lease by ninety years. Comparable flats in Shiremoor with a long lease were worth £250,400. The mid-range ground rent payable was £65 collected monthly. The lease came to a finish in 2090. Taking into account 64 years remaining we calculated the premium to the landlord to extend the lease to be within £19,000 and £22,000 plus professional charges.