Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Woking. Clearly, the period of lease left shortens as time goes by. This may slip by relatively unnoticed when the property needs to be disposed of or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to extend the lease. Qualifying long lease owners in Woking have the right to extend the lease for an additional ninety years in accordance with legislation. Do give careful deliberation before putting off your Woking lease extension. Putting off the cost now simply increases the price you will ultimately have to pay for a lease extension
Leasehold residencies in Woking with more than 100 years outstanding on the lease are sometimes 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 upside in buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Woking 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.
After unsuccessful negotiations with the freeholder of her two bedroom apartment in Woking, Ellie commenced the lease extension process as the eighty year deadline was swiftly approaching. The transaction completed in May 2008. The landlord’s charges were kept to an absolute minimum.
In 2009 we were approached by Mr and Mrs. R López who, having purchased a one bedroom apartment in Woking in February 2006. The dilemma was if we could approximate the premium could be to prolong the lease by ninety years. Comparative flats in Woking with a long lease were in the region of £225,800. The mid-range amount of ground rent was £60 collected every twelve months. The lease lapsed in 2085. Taking into account 60 years outstanding we estimated the compensation to the freeholder to extend the lease to be within £25,700 and £29,600 plus expenses.
Mr Finn Lambert was assigned a lease of a basement apartment in Woking in July 1996. We are asked if we could approximate the compensation to the landlord would likely be for a 90 year lease extension. Similar properties in Woking with a long lease were worth £210,000. The mid-range amount of ground rent was £50 collected per annum. The lease lapsed on 25 October 2105. Given that there were 80 years outstanding we calculated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of legals.