When it comes to long leasehold premises in Tooting, you effectively rent it for a certain amount of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are fewer than eighty years remaining. Residents in Tooting with a lease approaching 81 years unexpired should seriously think of extending it without delay. When the lease term has below 80 years outstanding, under the current legislation the freeholder is entitled to calculate and demand a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold premises in Tooting with more than 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in 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. |
| 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 remaining 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Lease extensions in Tooting can be a difficult process. We recommend you procure guidance from a lawyer and surveyor well versed in the legislation and lease extension process.
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 Tooting lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Leo owned a 2 bedroom flat in Tooting being marketed with a lease of fraction over fifty eight years left. Leo on an informal basis approached his landlord being a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £50 yearly. Ordinarily, ground rent would not be due on a lease extension were Leo to invoke his statutory right. Leo procured expert advice and secured an acceptable deal informally and ending up with a market value flat.
Ms Alice Brooks moved into a basement apartment in Tooting in August 2008. We are asked if we could shed any light on how much (roughly) price could be to extend the lease by a further 90 years. Comparative premises in Tooting with 100 year plus lease were in the region of £208,200. The average amount of ground rent was £65 billed annually. The lease terminated on 15 July 2087. Considering the 61 years remaining we estimated the compensation to the landlord to extend the lease to be between £19,000 and £22,000 plus legals.
An example of a Lease Extension decision for a Tooting residence is 14 Nutwell Street in January 2014. The premium payable for the acquisition of a new lease of the subject premises was in the sum of £30,523 This case was in relation to 1 flat. The unexpired term as at the valuation date was 62.94 years.