Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will usually be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Stockport. Clearly, the length of lease remaining reduces as time goes by. This is often ignored and only becomes a problem when the property needs to be sold or refinanced. The fewer the years remaining the lower the value of the property and the more it will cost to procure a lease extension. Qualifying leaseholders in Stockport have the legal entitlement to extend the lease for a further ninety years in accordance with legislation. Please give due consideration before delaying your Stockport lease extension. Holding off the cost now simply increases the price you will eventually incur for a lease extension
Leasehold residencies in Stockport with in excess of one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance 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; |
| 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. |
| 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. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Stockport,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Stockport valuers.
14 months ago Ali, came seriously close to the eighty-year mark with the lease on his leasehold flat in Stockport. Having bought his property 19 years previously, the lease term was of no significance. Thankfully, he became aware that he would imminently be paying an inflated amount for Extending the lease. Ali was able to extend his lease just in the nick of time in August. Ali and the freeholder in the end settled on a premium of £5,000 . If the lease had descended below 80 years, the figure would have increased by a minimum £900.
Mr E Bernard was assigned a lease of a studio flat in Stockport in January 2000. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by an additional years. Identical residencies in Stockport with a long lease were worth £237,600. The mid-range ground rent payable was £45 invoiced every twelve months. The lease lapsed on 6 April 2093. Given that there were 67 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 not including legals.
In 2009 we were called by Mr Riley Davies who, having bought a ground floor apartment in Stockport in May 2004. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by an additional years. Similar properties in Stockport with an extended lease were worth £280,000. The mid-range ground rent payable was £55 billed yearly. The lease expired on 9 April 2104. Given that there were 78 years unexpired we approximated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus fees.