Unfortunately that a Swadlincote residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Swadlincote property prices.Where your lease has approximately 90 years left, you need to start considering a lease extension. If lease term slips under 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most flat owners in Swadlincote will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the process.
Leasehold residencies in Swadlincote with over 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
The conveyancing solicitors that we work with procure Swadlincote 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.
Off the back of lengthy negotiations with the landlord of her purpose-built apartment in Swadlincote, Jessica started the lease extension process just as the lease was coming close to the all-important 80-year deadline. The lease extension was finalised in February 2009. The landlord’s costs were restricted to less than 550 pounds.
Mrs Lydia Brown was assigned a lease of a studio flat in Swadlincote in March 1995. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year extension to my lease. Identical premises in Swadlincote with 100 year plus lease were in the region of £223,400. The average amount of ground rent was £60 invoiced yearly. The lease terminated in 2085. Considering the 59 years left we estimated the premium to the landlord to extend the lease to be between £27,600 and £31,800 not including professional charges.
In 2014 we were e-mailed by Dr B Laurent who, having owned a recently refurbished apartment in Swadlincote in January 1996. The dilemma was if we could approximate the premium would likely be to extend the lease by an additional years. Comparative premises in Swadlincote with an extended lease were worth £210,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease terminated on 4 November 2105. Taking into account 79 years left we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 not including legals.