Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will usually be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Stanwell. Inevitably, the period of lease remaining shortens as time goes by. This is often overlooked and only raises itself as an issue when the residence needs to be disposed of or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension. Eligible long lease owners in Stanwell have the legal entitlement to extend the lease for a further 90 years under Leasehold Reform legislation. You should give careful attention before putting off your Stanwell lease extension. Putting off the cost now likely increases the price you will ultimately incur to extend your lease
Leasehold properties in Stanwell with more than 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Halifax | 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. |
The conveyancing solicitors that we work with procure Stanwell 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 lawyer we work with provide it.
Last October Aiden, came perilously near to the 80-year threshold with the lease on his garden flat in Stanwell. Having purchased his flat 18 years previously, the lease term was of minimal interest. As luck would have it, he noticed he would soon be paying an escalated premium for Extending the lease. Aiden was able to extend his lease just in the nick of time last January. Aiden and the freeholder via the managing agents subsequently settled on a premium of £6,000 . If he failed to meet the deadline, the figure would have escalated by at least £975.
Mr and Mrs. F Bernard moved into a one bedroom flat in Stanwell in October 2008. We are asked if we could estimate the price would be for a 90 year lease extension. Comparative homes in Stanwell with 100 year plus lease were worth £218,000. The average ground rent payable was £45 invoiced every twelve months. The lease lapsed in 2089. Considering the 63 years left we estimated the compensation to the freeholder for the lease extension to be within £17,100 and £19,800 exclusive of expenses.
An example of a Lease Extension case for a Stanwell premises is 147 Redford Close in June 2012. The Tribunal determined the lease extension premium to be at £4,200 This case affected 1 flat. The remaining number of years on the lease was 82.93 years.