Stroud leases on residential deteriorating in value. if your lease has in the region of ninety years remaining, you should start thinking about a lease extension. 80 years is a significant number: when the unexpired term of a lease dips below this level then you start paying an additional element called marriage value. Flat owners in Stroud will usually be legally entitled to a lease extension; however a solicitor will confirm if you qualify. In certain circumstances you may not be entitled. There are prescribed timetables and steps to follow once the process has started so it’s best to be guided by a lawyer during the process.
It is generally considered that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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 |
The conveyancing solicitors that we work with handle Stroud 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.
Last year Felix, came seriously near to the eighty-year threshold with the lease on his two bedroom apartment in Stroud. Having purchased his flat 19 years ago, the length of the lease was of minimal significance. Thankfully, it dawned on him that he would imminently be paying an inflated amount for Extending the lease. Felix arranged for a lease extension just in the nick of time in June. Felix and the landlord who owned the flat above eventually settled on sum of £5,000 . If he had missed the deadline, the sum would have become more exhorbitant by at least £1,100.
Mr and Mrs. N Rodríguez took over the lease of a one bedroom apartment in Stroud in October 2001. The question was if we could approximate the compensation to the landlord would be to extend the lease by ninety years. Comparative premises in Stroud with 100 year plus lease were in the region of £261,600. The average ground rent payable was £60 collected yearly. The lease expired on 1 April 2078. Having 52 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £39,000 and £45,000 plus costs.
In 2011 we were e-mailed by Mr Y Lefebvre who, having purchased a studio apartment in Stroud in January 2009. We are asked if we could estimate the premium would likely be to prolong the lease by an additional years. Identical premises in Stroud with 100 year plus lease were valued about £218,000. The mid-range amount of ground rent was £45 invoiced quarterly. The lease came to a finish on 24 September 2089. Taking into account 63 years remaining we calculated the compensation to the freeholder to extend the lease to be between £17,100 and £19,800 not including costs.