Unfortunately that a Winchcombe residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Winchcombe property market.Where your lease has approximately 90 years left, you need to start considering a lease extension. If the number of years remaining slips under 80 years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most flat owners in Winchcombe will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold premises in Winchcombe with more than 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth 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 service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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| 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 lawyers that we work with handle Winchcombe 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 lawyer we work with provide it.
During the course of the last few months Alfie, came critically near to the 80-year mark with the lease on his leasehold apartment in Winchcombe. In buying his property two decades ago, the length of the lease was of no concern. Fortunately, he became aware that he needed to take action soon on a lease extension. Alfie was able to extend his lease at the eleventh hour in June. Alfie and the freeholder ultimately agreed on an amount of £5,000 . If he failed to meet the deadline, the price would have escalated by a minimum £1,025.
Ms W Torres took over the lease of a one bedroom flat in Winchcombe in August 2010. We are asked if we could shed any light on how much (approximately) price would be to extend the lease by an additional years. Comparable properties in Winchcombe with a long lease were worth £295,000. The mid-range amount of ground rent was £45 collected yearly. The lease lapsed on 22 June 2100. Given that there were 74 years left we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
Last Summer we were approach by Mr and Mrs. J Lefebvre , who took over the lease of a studio flat in Winchcombe in April 2001. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Identical properties in Winchcombe with 100 year plus lease were valued around £243,000. The average amount of ground rent was £65 invoiced every twelve months. The lease concluded on 3 April 2089. Considering the 63 years left we estimated the premium to the freeholder for the lease extension to be between £20,000 and £23,000 plus expenses.