For those whose Tredegar property is held on a long lease, our message is clear – if you ignore the situation, the property will ultimately revert to the freeholder, leaving you empty-handed. The shorter the lease the lower the value of the property and the more expensive it will be to extend the lease.
Leasehold properties in Tredegar with over 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with undertake Tredegar 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.
After protracted correspondence with the freeholder of her purpose-built apartment in Tredegar, Jordan started the lease extension process just as the lease was nearing the all-important eighty-year deadline. The legal work was concluded in August 2008. The freeholder’s fees were restricted to slightly above 600 GBP.
Mr and Mrs. G Ward acquired a ground floor flat in Tredegar in July 2000. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year lease extension. Comparative premises in Tredegar with a long lease were valued around £295,000. The mid-range ground rent payable was £45 invoiced every twelve months. The lease ended on 22 February 2100. Considering the 74 years remaining we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of costs.
Last Summer we were contacted by Ms J Fournier , who moved into a first floor flat in Tredegar in March 2004. We are asked if we could estimate the price would be to extend the lease by ninety years. Comparative flats in Tredegar with a long lease were valued around £243,000. The average amount of ground rent was £65 billed annually. The lease end date was on 7 August 2089. Considering the 63 years remaining we approximated the premium to the landlord to extend the lease to be within £20,000 and £23,000 exclusive of costs.