Chances are that if you own a flat in Stoke Bishop you actually own a long leasehold interest over your property
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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 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; |
| 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. |
| 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. |
The conveyancing solicitors that we work with handle Stoke Bishop 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.
After lengthy correspondence with the landlord of her basement apartment in Stoke Bishop, Kirsty initiated the lease extension process just as the lease was coming close to the crucial eighty-year threshold. The legal work completed in April 2010. The landlord’s fees were kept to an absolute minimum.
Last month we were phoned by Mr and Mrs. M Lewis , who completed a recently refurbished apartment in Stoke Bishop in May 1998. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by 90 years. Comparable homes in Stoke Bishop with 100 year plus lease were worth £285,000. The average amount of ground rent was £55 invoiced quarterly. The lease terminated on 10 June 2105. Given that there were 79 years unexpired we estimated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 exclusive of fees.
In 2009 we were phoned by Mrs Isabelle Cox who, having bought a studio flat in Stoke Bishop in June 2009. The dilemma was if we could estimate the premium would be for a 90 year extension to my lease. Similar homes in Stoke Bishop with a long lease were worth £193,400. The mid-range amount of ground rent was £65 billed yearly. The lease expired on 27 August 2085. Given that there were 59 years left we approximated the compensation to the landlord for the lease extension to be between £21,900 and £25,200 not including expenses.