Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will ordinarily be granted for a set period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Whitland. Clearly, the period of lease remaining reduces as time goes by. This is often overlooked and only raises itself as an issue when the flat or house has to be sold or refinanced. The shorter the lease the less it is worth and the more expensive it will be to procure a lease extension. Qualifying long lease owners in Whitland have the right to extend the lease for a further ninety years in accordance with statute. Please give careful deliberation before putting off your Whitland lease extension. Putting off the cost now only increases the price you will eventually have to pay to extend your lease
Leasehold premises in Whitland 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 premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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. |
| Chelsea 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with undertake Whitland 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.
Following protracted correspondence with the freeholder of her two bedroom apartment in Whitland, Sophia commenced the lease extension process just as the lease was approaching the all-important 80-year mark. The lease extension was finalised in May 2011. The freeholder’s fees were negotiated to below 600 GBP.
Last month we were approach by Mr and Mrs. C Peterson , who purchased a garden apartment in Whitland in August 2012. We are asked if we could estimate the premium would be for a 90 year lease extension. Comparative homes in Whitland with an extended lease were worth £206,200. The mid-range amount of ground rent was £55 invoiced monthly. The lease came to a finish in 2082. Taking into account 56 years left we calculated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 not including expenses.
Last Summer we were e-mailed by Mr Owen Wilson , who acquired a purpose-built apartment in Whitland in March 2012. The dilemma was if we could approximate the premium would be for a ninety year extension to my lease. Comparative properties in Whitland with 100 year plus lease were worth £300,000. The average amount of ground rent was £50 invoiced per annum. The lease came to a finish on 13 May 2102. Taking into account 76 years outstanding we estimated the premium to the landlord to extend the lease to be between £8,600 and £9,800 not including fees.