For anyone whose Wolverton home is held on a long lease, the message is clear – if you do nothing, your property will ultimately revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease.
Leasehold premises in Wolverton with over 100 years remaining 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 circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Wolverton leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Eliot was the the leasehold owner of a studio apartment in Wolverton being marketed with a lease of fraction over 59 years left. Eliot informally contacted his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £50 per annum. No ground rent would be due on a lease extension were Eliot to invoke his statutory right. Eliot procured expert advice and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
In 2013 we were phoned by Ms Amy Khan who, having purchased a first floor flat in Wolverton in September 2003. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by a further 90 years. Identical premises in Wolverton with 100 year plus lease were valued about £166,400. The average ground rent payable was £60 billed annually. The lease termination date was in 2080. Considering the 54 years left we approximated the premium to the landlord to extend the lease to be between £32,300 and £37,400 exclusive of legals.
Last Spring we were approach by Mr and Mrs. Y Petit , who acquired a first floor flat in Wolverton in April 2007. The question was if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Identical homes in Wolverton with an extended lease were worth £227,800. The mid-range ground rent payable was £45 billed quarterly. The lease lapsed in 2091. Given that there were 65 years outstanding we calculated the premium to the landlord for the lease extension to be between £13,300 and £15,400 plus costs.