If you are facing a significant premium because your lease in Stalybridge has dropped toward the 80-year mark, your previous lawyer may be at fault. Our panel of experts specialise in recovering lease extension costs from negligent firms who failed to protect your investment.
Main reasons to commence your Stalybridge lease extension today:
Increase your lease and increase your Stalybridge property value
Owning a flat usually means owning a lease of the property, which has a set term of years. This lease will usually be granted for a fixed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Stalybridge. Inevitably, the term of lease left reduces over time. This is often ignored and only becomes a problem when the residence needs to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible leaseholders in Stalybridge have the right to extend the lease for an additional 90 years under Leasehold Reform legislation. Please give due consideration before delaying your Stalybridge lease extension. Putting off that expense now likely increases the price you will ultimately have to pay for a lease extension
Stalybridge property with a lease extension has roughly the same value as a freehold
It is generally accepted that a property with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years left, the residence will be worth the same as a freehold for many years in the future.
Mortgage lenders may not loan monies with a short lease
Nearly all mortgage companies will be unwilling to grant a mortgage on a lease with under 70 years left to run - although this varies between mortgage companies. A purchaser will no doubt encounter difficulties in obtaining a mortgage and this will result in your Stalybridge property being difficult to dispose of or to obtain finance on.
| Lender |
Requirement
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|---|
| Bank of Scotland |
Minimum 70 years from the date of the mortgage.
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| Barclays plc |
Leases with less than 70 years at the commencement of the mortgage are not acceptable.
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;
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| Coventry Building Society |
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.
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| The Mortgage Works |
Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term.
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 70 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period less than or equal to 5 years
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 70 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Issuing Office (will be declined):
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house
- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn ground rent (annual rent) charges
For the avoidance of doubt, any new build properties completed but not sold pre 30 June 2022 will only be acceptable if the lease conforms to the above guidance
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years
Lease Extensions We require all Lease Extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where a proposed Lease Extension does not meet these requirements, however you feel that this is in the best interest for our mutual client, please refer all details to the Issuing Office for us to consider.
Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
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| 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.
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What makes us experts in Stalybridge lease extensions?
Lease extensions in Stalybridge can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Stalybridge lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Stalybridge Lease Extension Example Cases:
Henry, Stalybridge, Greater Manchester
Last October Henry, came perilously close to the 80-year threshold with the lease on his basement flat in Stalybridge. Having purchased his flat 19 years ago, the unexpired term was of little significance. As luck would have it, he recognised he would imminently be paying an inflated amount for Extending the lease. Henry extended the lease at the eleventh hour last April. Henry and the freeholder ultimately agreed on the final figure of £5,000 . If the lease had dropped lower than eighty years, the sum would have escalated by at least £1,000.
Stalybridge case:
Last month we were contacted by Ms J Garcia , who
purchased a purpose-built apartment in Stalybridge in May 2007. We are asked if we could approximate the premium could be for a ninety year lease extension. Identical residencies in Stalybridge with 100 year plus lease were worth £166,400. The mid-range ground rent payable was £60 billed monthly. The lease came to a finish in 2080. Given that there were 54 years unexpired we estimated the premium to the freeholder to extend the lease to be within £32,300 and £37,400 exclusive of costs.
Stalybridge case:
In 2012 we were e-mailed by Mr and Mrs. B Campbell who, having moved into a purpose-built apartment in Stalybridge in March 2000. We are asked if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Comparable homes in Stalybridge with a long lease were worth £232,800. The average ground rent payable was £45 collected yearly. The lease elapsed in 2091. Having 65 years remaining we calculated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including fees.