There is no doubt about it a leasehold property in Trefnant is a wasting asset as a result of the shortening lease. Where the lease has, over 99 years to run then this decrease may be fractional that being said there will become a stage when a lease has fewer than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main rational as to why you should extend the lease without delay. Most flat owners in Trefnant will meet the qualifying criteria; however a conveyancing solicitor can confirm if you qualify for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for under two years.
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| 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; |
| Halifax | Minimum 70 years from the date 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. |
| 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 conveyancing solicitors that we work with handle Trefnant 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.
Subsequent to protracted discussions with the landlord of her ground floor apartment in Trefnant, Caitlin commenced the lease extension process as the eighty year mark was rapidly approaching. The transaction completed in January 2009. The landlord’s costs were restricted to a tad over 700 pounds.
Mr and Mrs. O Murphy moved into a studio apartment in Trefnant in August 1997. We are asked if we could estimate the price could be for a 90 year lease extension. Similar homes in Trefnant with an extended lease were in the region of £166,400. The mid-range amount of ground rent was £60 collected quarterly. The lease terminated in 2079. Having 54 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £32,300 and £37,400 plus professional charges.
Last year we were approach by Dr Ellie Collins , who was assigned a lease of a ground floor apartment in Trefnant in June 2000. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Similar properties in Trefnant with an extended lease were in the region of £227,800. The mid-range ground rent payable was £45 invoiced quarterly. The lease lapsed on 26 September 2090. Taking into account 65 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 not including costs.