If you are facing a significant premium because your lease in Wallasey has dropped toward the 80-year mark, your previous lawyer may be at fault. Our panel of experts specialise in recovering lease extension costs from negligent firms who failed to protect your investment.
Main reasons to start your Wallasey lease extension today:
Increase your lease and increase your Wallasey property value
The value of Wallasey leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate substantially once the unexpired lease term is less than eighty years
Wallasey property with a lease extension is almost the same value as a freehold
It is generally considered that a residential leasehold with over one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the property will be equivalent in value to a freehold for decades to come.
Mortgage lenders may decide not to lend on a short lease
Banks and Building Societies are less likely to grant a loan offer on a domestic property in Wallasey with a short lease. Some lenders simply refuse a mortgage on leases with under 75 years left.
| Lender |
Requirement
|
|---|
| Halifax |
Minimum 70 years from the date of the mortgage.
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| Leeds Building Society |
85 years remaining from the start of the mortgage.
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| The Mortgage Works |
Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term.
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- 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
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
New build property:
- 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)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
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.
SECOND HAND PROPERTIES
Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 70 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- 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
- Ground Rent is compounded RPI
- Ground Rent review period less than or equal to 5 years
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 70 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Issuing Office (will be declined):
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house
- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- 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
- A lease subject to a peppercorn ground rent (annual rent) charges
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
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- 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?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years
Lease Extensions 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 a proposed Lease Extension does not meet these requirements, however you feel that this is in the best interest for our mutual client, please refer all details to the Issuing Office for us to consider.
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.
|
| Royal Bank of Scotland |
Mortgage term plus 30 years.
|
| Virgin |
85 years at the time of completion. If it's less, we require it to be extended on or before completion.
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Why use us for your lease extension in Wallasey?
The conveyancers that we work with procure Wallasey 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.
Wallasey Lease Extension Example Cases:
Eliot, Wallasey, Merseyside
Last October Eliot, came precariously near to the eighty-year threshold with the lease on his leasehold flat in Wallasey. In buying his home twenty years previously, the length of the lease was of no significance. by good luck, he recognised he would imminently be paying an inflated amount for Extending the lease. Eliot was able to extend his lease just in the nick of time last May. Eliot and the freeholder via the management company eventually agreed on sum of £5,000 . If the lease had dipped lower than 80 years, the price would have gone up by at least £850.
Wallasey case:
Last Spring we were e-mailed by Mr and Mrs. D Hill , who
purchased a one bedroom apartment in Wallasey in March 2011. The dilemma was if we could shed any light on how much (approximately) price would likely be to prolong the lease by 90 years. Comparable properties in Wallasey with a long lease were in the region of £275,000. The mid-range amount of ground rent was £65 collected every twelve months. The lease lapsed on 5 July 2094. Taking into account 68 years as a residual term we approximated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of costs.
Wallasey case:
Mr and Mrs. I Bernard took over the lease of a first floor flat in Wallasey in January 1996. We are asked if we could approximate the price would likely be to prolong the lease by ninety years. Similar homes in Wallasey with a long lease were worth £208,600. The mid-range amount of ground rent was £60 collected annually. The lease ran out on 2 June 2083. Given that there were 57 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £30,400 and £35,200 not including fees.