Telford leases on residential deteriorating in value. if your lease has about 90 years left, you should start thinking about a lease extension. If lease term is less than 80 years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Telford will usually qualify for a lease extension; however a solicitor will confirm your eligibility. In some situations you may not qualify. There are also strict deadlines and formalities to follow once the process has started so it’s prudent to be guided by a conveyancing solicitor during the process.
It is generally accepted that a residential leasehold with more than one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years in the future.
| 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Using our service gives you enhanced control over the value of your Telford leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 9 months of lengthy correspondence with the freeholder of her ground floor flat in Telford, Alice started the lease extension process as the 80 year mark was fast nearing. The lease extension completed in January 2011. The landlord’s fees were kept to an absolute minimum.
In 2009 we were called by Mr and Mrs. K Morris who, having took over the lease of a studio apartment in Telford in March 1996. We are asked if we could approximate the compensation to the landlord would likely be for a ninety year lease extension. Identical homes in Telford with 100 year plus lease were valued around £191,400. The mid-range amount of ground rent was £55 invoiced monthly. The lease finished in 2079. Having 54 years as a residual term we calculated the premium to the landlord to extend the lease to be between £34,200 and £39,600 not including costs.
In 2010 we were approached by Mr A Morgan who, having took over the lease of a basement flat in Telford in February 1998. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Comparable premises in Telford with 100 year plus lease were in the region of £295,000. The mid-range amount of ground rent was £45 invoiced per annum. The lease terminated in 2099. Having 74 years left we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of professional charges.