For anyone whose Stockwood property is held on a long lease, the message is clear – if you do nothing, your property will ultimately revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more it will cost to obtain a lease extension.
Leasehold premises in Stockwood with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with undertake Stockwood 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.
In recent months Matthew, came very near to the eighty-year mark with the lease on his first floor apartment in Stockwood. In buying his home two decades ago, the unexpired term was of little interest. by good luck, he realised he would imminently be paying way over the odds for Extending the lease. Matthew arranged for a lease extension at the eleventh hour last April. Matthew and the freeholder eventually settled on a premium of £6,000 . If the lease had dipped below 80 years, the premium would have become more costly by at least £900.
In 2011 we were phoned by Mr and Mrs. T Turner who, having acquired a basement flat in Stockwood in November 2010. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Comparable flats in Stockwood with 100 year plus lease were valued around £260,000. The mid-range amount of ground rent was £50 collected per annum. The lease termination date was on 23 November 2099. Having 73 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 plus professional charges.
Mr Henry Flores bought a basement apartment in Stockwood in February 2006. The question was if we could shed any light on how much (roughly) price would likely be to prolong the lease by ninety years. Identical residencies in Stockwood with a long lease were worth £264,000. The mid-range ground rent payable was £60 billed annually. The lease terminated on 5 January 2079. Having 53 years left we calculated the compensation to the landlord for the lease extension to be between £37,100 and £42,800 not including professional charges.