As the the remaining lease term of a Temple Mills domestic lease decreases so does its value and therefore the value of your property. Where the residual term has, more than 125 years remaining then this decrease may be of little impact that being said there will become a stage when a lease has under than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary reason why you should extend the lease without delay. Most flat owners in Temple Mills will meet the qualifying criteria; nevertheless a conveyancing solicitor can confirm if you are eligible for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold residencies in Temple Mills with in excess of one hundred years outstanding 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 service charges justify 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 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 handle Temple Mills 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.
Jack owned a studio apartment in Temple Mills being marketed with a lease of a little over 72 years unexpired. Jack informally contacted his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £125 per annum. No ground rent would be due on a lease extension were Jack to exercise his statutory right. Jack obtained expert advice and was able to make an informed decision and deal with the matter and sell the flat.
In 2010 we were called by Ms U André who, having took over the lease of a studio apartment in Temple Mills in August 2008. The question was if we could estimate the price would be to extend the lease by ninety years. Comparative residencies in Temple Mills with 100 year plus lease were valued about £227,800. The mid-range amount of ground rent was £45 invoiced annually. The lease came to a finish on 16 March 2090. Given that there were 65 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 plus legals.
Mr R Pérez took over the lease of a one bedroom apartment in Temple Mills in February 1997. We are asked if we could approximate the premium would likely be to prolong the lease by a further 90 years. Similar homes in Temple Mills with a long lease were worth £275,000. The average ground rent payable was £55 invoiced monthly. The lease ended in 2101. Considering the 76 years unexpired we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of legals.