There is no doubt about it a leasehold property in Stoke Sub Hamdon is a wasting asset as a result of the diminishing lease term. If the residual term has, over one hundred years to run then this decrease may be fractional however there will become a stage when a lease has less than eighty years remaining as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the main rational as to why you should extend the lease without delay. The majority of flat owners in Stoke Sub Hamdon will qualify for this right; nevertheless a conveyancer will be able to advise if you are eligible to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold properties in Stoke Sub Hamdon with over one hundred years left 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 home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with handle Stoke Sub Hamdon 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.
Elijah owned a 2 bedroom flat in Stoke Sub Hamdon being sold with a lease of fraction over 59 years outstanding. Elijah on an informal basis spoke with his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £50 annually. No ground rent would be due on a lease extension were Elijah to invoke his statutory right. Elijah procured expert legal guidance and was able to make an informed decision and deal with the matter and ending up with a market value flat.
In 2011 we were phoned by Mr M Roberts who, having was assigned a lease of a ground floor apartment in Stoke Sub Hamdon in November 1998. We are asked if we could estimate the premium could be to extend the lease by a further 90 years. Identical flats in Stoke Sub Hamdon with an extended lease were valued around £181,600. The mid-range amount of ground rent was £55 invoiced monthly. The lease expired on 17 August 2078. Having 52 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £30,400 and £35,200 plus fees.
Mr and Mrs. N Collins acquired a studio flat in Stoke Sub Hamdon in July 2006. The dilemma was if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Identical flats in Stoke Sub Hamdon with an extended lease were worth £285,000. The average ground rent payable was £45 billed quarterly. The lease came to a finish in 2098. Considering the 72 years remaining we estimated the premium to the landlord to extend the lease to be within £12,400 and £14,200 not including expenses.