It’s a harsh truth that a Tintern residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Tintern property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If lease term falls under eighty years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most leasehold owners in Tintern will be able to extend under the legislation; however a conveyancer should be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
It is generally considered that a property with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancers that we work with undertake Tintern 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 lawyer we work with provide it.
Trailing lengthy negotiations with the freeholder of her studio flat in Tintern, Amy started the lease extension process just as her lease was nearing the crucial 80-year deadline. The lease extension completed in May 2011. The landlord’s charges were kept to an absolute minimum.
Dr A Nguyen bought a first floor apartment in Tintern in June 2006. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year lease extension. Similar properties in Tintern with an extended lease were in the region of £275,000. The mid-range ground rent payable was £55 collected quarterly. The lease elapsed on 16 September 2102. Having 77 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 plus costs.
Last Summer we were phoned by Ms Chelsea Robinson , who purchased a recently refurbished apartment in Tintern in January 2002. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by an additional years. Similar properties in Tintern with an extended lease were in the region of £183,600. The mid-range amount of ground rent was £65 billed every twelve months. The lease expired on 21 February 2082. Taking into account 57 years left we approximated the premium to the landlord for the lease extension to be between £28,500 and £33,000 exclusive of expenses.