Chances are that where you own a flat in Sleaford you actually own a long leasehold interest over your property
Leasehold properties in Sleaford with over one hundred years left on the lease are sometimes referred to as ‘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 maintenance 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Sleaford 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.
Henry was the the leasehold proprietor of a high value flat in Sleaford on the market with a lease of a few days over 61 years outstanding. Henry on an informal basis approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking 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 Henry to exercise his statutory right. Henry obtained expert legal guidance and was able to make an informed decision and handle with the matter and ending up with a market value flat.
Mrs Freya David moved into a garden apartment in Sleaford in June 2002. We are asked if we could approximate the price could be for a ninety year lease extension. Similar properties in Sleaford with a long lease were in the region of £171,800. The mid-range ground rent payable was £55 collected yearly. The lease lapsed on 28 April 2075. Taking into account 50 years left we estimated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 plus expenses.
Mr and Mrs. O Leroy purchased a one bedroom flat in Sleaford in June 2002. The dilemma was if we could approximate the price would likely be to prolong the lease by ninety years. Comparable premises in Sleaford with a long lease were valued around £280,000. The average ground rent payable was £45 collected monthly. The lease expired on 3 June 2095. Taking into account 70 years as a residual term we approximated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.