With a residential leasehold premises in Swaffham, you effectively rent it for a certain amount 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 lengthy period of time, you should consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly notably when there are fewer than 80 years remaining. Anyone in Swaffham with a lease nearing 81 years left should seriously consider extending it without delay. Once the lease term has under 80 years remaining, under the relevant Act the landlord can calculate and charge a larger amount, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold residencies in Swaffham with more than 100 years remaining 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 property. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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. |
The conveyancers that we work with handle Swaffham 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 conveyancer we work with provide it.
Off the back of protracted discussions with the freeholder of her purpose-built flat in Swaffham, Bethany started the lease extension process just as her lease was approaching the all-important 80-year threshold. The legal work was finalised in June 2009. The landlord’s costs were kept to an absolute minimum.
Mr Harry Roux moved into a garden flat in Swaffham in September 2003. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by 90 years. Comparable properties in Swaffham with a long lease were in the region of £261,600. The mid-range amount of ground rent was £60 invoiced every twelve months. The lease ended on 13 July 2078. Given that there were 52 years as a residual term we calculated the compensation to the freeholder for the lease extension to be within £39,000 and £45,000 exclusive of professional charges.
In 2010 we were e-mailed by Dr F Green who, having owned a purpose-built flat in Swaffham in May 2004. We are asked if we could approximate the price would likely be to extend the lease by an additional years. Identical flats in Swaffham with an extended lease were in the region of £218,000. The average ground rent payable was £45 invoiced per annum. The lease concluded on 14 February 2089. Taking into account 63 years left we calculated the premium to the freeholder to extend the lease to be within £17,100 and £19,800 not including expenses.