Main reasons to start your Topsham lease extension
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<h3> Top reasons for lease extension now:
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Increase your lease and increase your <a href="http://www.lendermonitor.com/conveyancing/loc/topsham">Topsham</a> property value </h4>
<p> Unfortunately that a Topsham residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Topsham property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If lease term dips below 80 years, you will end up paying 50% 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 Topsham will be able to extend under the legislation; however a lawyer should be able to confirm if you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
<h4>Topsham property with a lease extension is almost the same value as a freehold</h4>
<p> It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the property will be equivalent in value to a freehold for decades to come.
<h4>Lending institutions will not issue a mortgage with a short lease</h4> Banks and building societies do not like short residential leases. You most probably experience difficulties if you want to sell your flat in Topsham if the remaining term of your lease is under the criteria set by most banks and building societies. Different lenders have varying criteria but generally theyrequire an unexpired term of at least 65 years.
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<td>Godiva Mortgages</td>
<td> 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.
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<td>National Westminster Bank</td>
<td> Mortgage term plus 30 years.<br /><br />For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage.
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<td>The Mortgage Works</td>
<td> Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term. <br />Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:<br /><br />Second hand property:<br />- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years <br />- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported<br />- For equity share applications - advise us if the actual lease term is different than reported on the offer<br /><br />New build property:<br />- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)<br />- For equity share applications - always advise us if the actual lease term is different than reported on the offer<br /><br />Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.<br /><br />SECOND HAND PROPERTIES<br /><br />Unacceptable - advise Issuing Office (Will be declined):<br />- Unexpired lease term less than 70 years<br />- Less than 30 years remaining at the end of the mortgage term<br />- Ground Rent greater than 0.5% of the property value<br />- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more<br />- Ground Rent is compounded RPI<br />- Ground Rent review period less than or equal to 5 years<br /><br />Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):<br />- Unexpired lease term is 70 to 85 years<br />- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value<br />- Ground Rent escalation is linked to any indices greater than RPI<br />- Ground Rent escalation is linked to the value of the building*<br />- Ground Rent review period is greater than 5 and less than 10 years<br />- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc<br />- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)<br />- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)<br />- Anything that appears onerous, unusual or out of the ordinary<br /><br />Acceptable (no requirement to advise Issuing Office): <br />- Unexpired lease term greater than 85 years<br />- Ground Rent less than or equal to 0.1% of the property value<br />- Ground Rent review period greater than or equal to 10 years<br />- Ground Rent escalation less than or equal to RPI<br /><br />NEW BUILD PROPERTIES (includes office conversions)<br /><br />Unacceptable - advise Issuing Office (will be declined):<br />- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house <br />- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis<br />- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology<br /><br />Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):<br />- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc<br />- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)<br />- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)<br />- Anything else appears onerous, unusual or out of the ordinary<br /><br />Acceptable (no requirement to advise Issuing Office):<br />- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house <br />- A lease subject to a peppercorn ground rent (annual rent) charges <br /><br />For the avoidance of doubt, any new build properties completed but not sold pre 30 June 2022 will only be acceptable if the lease conforms to the above guidance <br /><br />* Where the Ground Rent escalation is linked to the value of the building, please provide the following:<br />- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property? <br />- The current valuation and Ground Rent for each unit<br />- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?<br />- What is the right of appeal? And is this a documented process within the lease?<br />- Who bears the cost of the valuation (and appeal) process?<br />- Confirmation the review period is not less than twenty years<br /><br />LEASE EXTENSIONS<br /><br />We require all lease extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where you become aware that it does not meet these requirements, please refer to the Issuing Office <br /><br />Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
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<td>Royal Bank of Scotland</td>
<td> Mortgage term plus 30 years.
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<td>Yorkshire Building Society</td>
<td> 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.
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<h4> Get in touch with one of our Topsham lease extension solicitors or enfranchisement solicitors
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<p> Using our service gives you enhanced control over the value of your Topsham leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell.
The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions. <h4>
Topsham Lease Extension Case Summaries:
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<h5> Finley, Topsham, Devon,</h5>
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Finley owned a conversion flat in Topsham being marketed with a lease of a few days over 72 years unexpired. Finley informally contacted his landlord a well known Manchester-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Finley to invoke his statutory right. Finley procured expert legal guidance and was able to make an informed decision and deal with the matter and ending up with a market value flat.
<h5>Topsham case:</h5>
<p> Mr and Mrs. C Miller completed a recently refurbished flat in Topsham in August 2003. We are asked if we could shed any light on how much (roughly) price could be for a 90 year extension to my lease. Similar properties in Topsham with an extended lease were valued around £200,000. The mid-range ground rent payable was £50 invoiced annually. The lease termination date was on 12 June 2103. Considering the 77 years outstanding we approximated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including fees.
<h5>Topsham case:</h5>
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Last year we were contacted by Mr and Mrs. L Patel , who
bought a basement apartment in Topsham in June 2002. The question was if we could estimate the premium would likely be for a ninety year lease extension. Similar flats in Topsham with an extended lease were valued around £260,200. The average ground rent payable was £65 collected per annum. The lease elapsed on 8 October 2092. Given that there were 66 years remaining we calculated the premium to the landlord to extend the lease to be between £15,200 and £17,600 plus costs.
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