With a domestic leasehold premises in Torpoint, you are actually buying an entitlement to live in a property for a prescribed time frame. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should think about extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly especially once there are less than 80 years left. Residents in Torpoint with a lease nearing 81 years unexpired should seriously consider extending it sooner as opposed to later. Once a lease has below eighty years remaining, under the relevant legislation the freeholder can calculate and levy a larger amount, based on a technical calculation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Torpoint 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 conveyancer we work with provide it.
Toby owned a high value flat in Torpoint being marketed with a lease of just over 72 years remaining. Toby on an informal basis contacted his landlord a well known Manchester-based freehold company for a lease extension. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Toby to invoke his statutory right. Toby obtained expert legal guidance and secured satisfactory deal without resorting to tribunal and ending up with a market value flat.
In 2014 we were e-mailed by Mr G Bonnet who, having bought a first floor apartment in Torpoint in April 1999. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by a further 90 years. Identical flats in Torpoint with 100 year plus lease were valued around £295,000. The average ground rent payable was £50 billed every twelve months. The lease ran out on 1 September 2100. Given that there were 75 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 exclusive of professional charges.
Last year we were e-mailed by Mr and Mrs. W David , who took over the lease of a ground floor flat in Torpoint in November 2008. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year lease extension. Identical flats in Torpoint with a long lease were in the region of £250,400. The average amount of ground rent was £65 invoiced monthly. The lease concluded on 9 January 2089. Having 64 years left we calculated the premium to the freeholder for the lease extension to be between £19,000 and £22,000 not including fees.