As the length of the unexpired term of a Stretton residential lease lessens so does its value and therefore the value of your property. If the residual term has, more than 100 years to run then this decrease may be of little impact however there will become a stage when a lease has fewer than eighty years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should consider extending sooner as opposed to later. Many flat owners in Stretton will meet the qualifying criteria; nevertheless a conveyancer can advise whether you are eligible for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Stretton with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | 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. |
| 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. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Stretton,the lease extension experts 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 Stretton valuers.
Last October Alex, came dangerously close to the eighty-year mark with the lease on his purpose- built apartment in Stretton. Having bought his home two decades ago, the lease term was of little importance. Thankfully, he became aware that he needed to take action soon on a lease extension. Alex extended the lease just ahead of time last August. Alex and the landlord eventually agreed on a premium of £5,500 . If he not met the deadline, the premium would have gone up by a minimum £950.
Last Christmas we were called by Mr and Mrs. M Jackson , who moved into a newly refurbished flat in Stretton in August 2001. The dilemma was if we could approximate the price could be to prolong the lease by 90 years. Identical premises in Stretton with an extended lease were worth £280,000. The average ground rent payable was £55 collected monthly. The lease concluded on 1 July 2103. Taking into account 78 years remaining we approximated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 not including fees.
Last Christmas we were called by Mr and Mrs. D Anderson , who acquired a garden flat in Stretton in March 1997. The dilemma was if we could estimate the premium could be to extend the lease by an additional years. Comparative premises in Stretton with a long lease were worth £191,000. The average ground rent payable was £65 collected annually. The lease ran out on 7 June 2083. Having 58 years left we approximated the compensation to the freeholder to extend the lease to be within £23,800 and £27,400 plus legals.