Chances are that if you own a flat in Thorne you actually own a long leasehold interest over your property
It is generally accepted that a residential leasehold with in excess of 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 conveyancers that we work with procure Thorne 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.
Trailing unsuccessful discussions with the freeholder of her basement flat in Thorne, Freya started the lease extension process just as her lease was coming close to the critical eighty-year mark. The transaction was concluded in August 2007. The freeholder’s charges were negotiated to slightly above 450 pounds.
In 2010 we were approached by Mr and Mrs. L González who, having completed a recently refurbished flat in Thorne in June 2002. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by a further 90 years. Comparative properties in Thorne with 100 year plus lease were worth £203,200. The average ground rent payable was £65 invoiced yearly. The lease ended in 2086. Given that there were 61 years left we estimated the premium to the freeholder to extend the lease to be between £19,000 and £22,000 not including expenses.
Mr and Mrs. C Leroy bought a garden flat in Thorne in September 1998. We are asked if we could approximate the price would be for a ninety year lease extension. Comparative residencies in Thorne with 100 year plus lease were worth £260,000. The average amount of ground rent was £50 collected monthly. The lease elapsed on 17 April 2097. Taking into account 72 years unexpired we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including legals.