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Top reasons for Thornton Heath lease extension


Why you should start your Thornton Heath lease extension today:

A Thornton Heath leasehold property depreciates with the years remaining on the lease.

The re-sale value of a leasehold property in Thornton Heath is impacted by how long the lease has remaining. If it is near to or less than 80 years you should expect problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. Ideally one should start the lease extension process when a lease still has 82 years unexpired so that formalities can be finalised in advance of the 80 year cut off point. Leasehold Reform legislation enables Thornton Heath qualifying lessees to a 90 year extension added to their residual lease term (ie if your lease has 50 years remaining the statutory lease extension will provide a new term of 140 years). The reason of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.

An extended lease is almost the same value as a freehold

It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the property will be worth the same as a freehold for many years in the future.

Banks and Building Societies will not grant a mortgage with a short lease

Mortgage Lenders differ in their lending requirements. Some draw the line at seventy five years outstanding on the lease; others may be prepared to lend with anything in excess 70 years. With less than 60 years, it may be impossible to get a mortgage at all.

Lender Requirement
Birmingham Midshires Minimum 70 years from the date of the mortgage.
Godiva Mortgages 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.
Leeds Building Society 85 years remaing from the start 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.
TSB Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption.

What makes us experts in Thornton Heath lease extensions?

Lease extensions in Thornton Heath can be a difficult process. We recommend you get professional help from a conveyancing solicitor and valuer with experience in lease extensions.

We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Thornton Heath lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.

Thornton Heath Lease Extension Case Studies:

Adam, Thornton Heath, Surrey,

Adam owned a conversion flat in Thornton Heath being marketed with a lease of a little over sixty years remaining. Adam on an informal basis spoke with his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Adam to exercise his statutory right. Adam procured expert legal guidance and secured satisfactory resolution informally and sell the property.

Thornton Heath case:

In 2013 we were contacted by Mr and Mrs. W Miller who, having bought a ground floor flat in Thornton Heath in August 1997. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Identical homes in Thornton Heath with 100 year plus lease were in the region of £213,600. The mid-range amount of ground rent was £60 billed annually. The lease terminated on 5 February 2079. Given that there were 57 years unexpired we estimated the compensation to the landlord to extend the lease to be within £30,400 and £35,200 plus professional charges.

Decision in Croydon

An example of a Lease Extension matter before the tribunal for a Thornton Heath property is Ground Floor Flat 14 Lodge Road in October 2013. the tribunal held that the price payable for the acquisition of the extended lease of the property should be £12,590 .00 This case related to 1 flat. The unexpired residue of the current lease was 69.46 years.