Owning a flat usually means owning a lease of the property, which has a finite term of years. your lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Winchelsea. Inevitably, the length of lease remaining reduces as time goes by. This is often ignored and only becomes a problem when the property has to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible long lease owners in Winchelsea have the legal entitlement to extend the lease for a further 90 years under the 1993 Leasehold Reform Act. Do give due deliberation before delaying your Winchelsea lease extension. Holding off the cost now simply increases the price you will ultimately have to pay for a lease extension
Leasehold residencies in Winchelsea with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| Godiva Mortgages | 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. |
| 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. |
The conveyancing solicitors that we work with handle Winchelsea 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 conveyancing solicitor we work with provide it.
In the wake of eight months of lengthy negotiations with the freeholder of her two bedroom flat in Winchelsea, Erin started the lease extension process just as her lease was nearing the critical 80-year threshold. The lease extension completed in September 2011. The freeholder’s costs were negotiated to below 500 GBP.
Last November we were called by Mr and Mrs. O Hill , who owned a purpose-built flat in Winchelsea in August 2011. The question was if we could estimate the price would be to extend the lease by ninety years. Comparative residencies in Winchelsea with a long lease were in the region of £208,600. The mid-range amount of ground rent was £60 collected every twelve months. The lease concluded on 7 August 2082. Considering the 57 years remaining we estimated the premium to the freeholder for the lease extension to be between £30,400 and £35,200 plus legals.
Dr Lily White moved into a newly refurbished flat in Winchelsea in May 2006. We are asked if we could shed any light on how much (roughly) price would likely be to prolong the lease by an additional years. Similar properties in Winchelsea with an extended lease were worth £200,000. The average ground rent payable was £50 collected quarterly. The lease elapsed in 2102. Taking into account 77 years remaining we approximated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus professional charges.