The basic rule is, all other factors being equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Wells have the right to extend the lease for an additional ninety years in accordance with legislation. Do think carefully before delaying your Wells lease extension. Shelving the costs now simply increases the amount you will ultimately be required to pay to extend the lease.
It is generally accepted that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the residence 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
The lawyers that we work with procure Wells 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 unsuccessful negotiations with the freeholder of her ground floor flat in Wells, Madeleine started the lease extension process just as her lease was approaching the crucial eighty-year deadline. The legal work was concluded in June 2014. The landlord’s charges were negotiated to about 550 GBP.
Last Summer we were phoned by Mr Dylan Baker , who bought a first floor apartment in Wells in July 1995. The question was if we could shed any light on how much (roughly) premium would be for a ninety year lease extension. Identical flats in Wells with 100 year plus lease were worth £265,000. The mid-range ground rent payable was £50 collected annually. The lease lapsed in 2099. Having 74 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including expenses.
In 2014 we were e-mailed by Mr and Mrs. F Wright who, having completed a ground floor apartment in Wells in April 2010. We are asked if we could approximate the premium would be to prolong the lease by an additional years. Comparable homes in Wells with a long lease were in the region of £166,400. The mid-range ground rent payable was £60 collected every twelve months. The lease lapsed in 2079. Considering the 54 years remaining we calculated the compensation to the freeholder to extend the lease to be between £32,300 and £37,400 not including legals.