With a long leasehold property in Sunderland, you are in fact renting it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are less than 80 years remaining. Residents in Sunderland with a lease drawing near to 81 years left should seriously consider extending it without delay. When a lease has under 80 years remaining, under the relevant legislation the freeholder can calculate and levy a greater amount, assessed on a technical computation, strangely termed as “marriage value” which is due.
Leasehold premises in Sunderland with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancing solicitors that we work with procure Sunderland 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.
In recent months Lucas, started to get near to the 80-year threshold with the lease on his purpose- built apartment in Sunderland. Having purchased his home two decades ago, the length of the lease was of little concern. Thankfully, he became aware that he needed to take steps soon on a lease extension. Lucas arranged for a lease extension just under the wire last June. Lucas and the freeholder ultimately settled on the final figure of £5,000 . If the lease had fallen below eighty years, the price would have become more costly by a minimum £875.
Last year we were called by Mr and Mrs. H Stewart , who purchased a basement apartment in Sunderland in October 2003. The question was if we could shed any light on how much (approximately) price would likely be to prolong the lease by 90 years. Comparable flats in Sunderland with a long lease were worth £280,000. The mid-range ground rent payable was £45 billed monthly. The lease terminated on 5 January 2096. Taking into account 70 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 not including costs.
Last February we were approach by Mr and Mrs. N Collins , who moved into a newly refurbished apartment in Sunderland in March 2010. We are asked if we could approximate the premium would be to prolong the lease by ninety years. Comparative flats in Sunderland with an extended lease were in the region of £223,400. The mid-range amount of ground rent was £60 billed annually. The lease end date was on 14 June 2085. Given that there were 59 years remaining we approximated the premium to the landlord for the lease extension to be within £27,600 and £31,800 plus expenses.