Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will ordinarily be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Stoke Bishop. Clearly, the length of lease remaining shortens as time goes by. This may pass by relatively unnoticed when the flat or house has to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more expensive it will be to procure a lease extension. Eligible long lease owners in Stoke Bishop have the legal entitlement to extend the lease for a further 90 years in accordance with statute. Please give due consideration before delaying your Stoke Bishop lease extension. Holding off that expense now only increases the price you will eventually have to pay for a lease extension
It is generally accepted that a property with more than one hundred years unexpired lease term is worth roughly the same 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 many years ahead.
| 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
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 conveyancing solicitor we work with provide it.
Subsequent to protracted discussions with the freeholder of her ground floor apartment in Stoke Bishop, Samantha commenced the lease extension process as the eighty year deadline was quickly advancing. The lease extension was concluded in November 2013. The landlord’s costs were kept to an absolute minimum.
Mrs H Michel moved into a one bedroom apartment in Stoke Bishop in February 1996. The dilemma was if we could approximate the price could be to prolong the lease by 90 years. Comparable properties in Stoke Bishop with 100 year plus lease were valued about £246,800. The mid-range ground rent payable was £60 collected quarterly. The lease concluded on 15 November 2075. Taking into account 50 years left we calculated the compensation to the landlord for the lease extension to be between £44,700 and £51,600 exclusive of fees.
Last Christmas we were called by Mr Theo Ward , who owned a first floor flat in Stoke Bishop in May 2004. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Comparative flats in Stoke Bishop with an extended lease were worth £208,200. The average amount of ground rent was £65 collected monthly. The lease expiry date was on 26 June 2086. Given that there were 61 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £20,000 and £23,000 not including costs.