With a long leasehold premises in Wooler, you are actually purchasing a right to live in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive particularly once there are less than 80 years left. Residents in Wooler with a lease drawing near to 81 years unexpired should seriously think of extending it as soon as possible. Once a lease has below eighty years left, under the relevant statute the freeholder is entitled to calculate and demand a greater amount, assessed on a technical computation, known as “marriage value” which is due.
Leasehold premises in Wooler with in excess of 100 years unexpired on the lease are sometimes referred to as ‘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 freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 conveyancing solicitors that we work with handle Wooler 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.
18 months ago Freddie, started to get close to the eighty-year threshold with the lease on his two bedroom flat in Wooler. Having bought his home two decades ago, the lease term was of little bearing. Thankfully, it dawned on him that he would soon be paying an escalated premium for a lease extension. Freddie extended the lease at the eleventh hour last August. Freddie and the freeholder ultimately agreed on a premium of £5,000 . If the lease had fallen below 80 years, the figure would have escalated by a minimum £875.
In 2009 we were e-mailed by Mr Eli Simon who, having acquired a one bedroom apartment in Wooler in June 2009. We are asked if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Identical premises in Wooler with 100 year plus lease were in the region of £173,800. The mid-range amount of ground rent was £60 billed monthly. The lease end date was in 2080. Taking into account 55 years as a residual term we calculated the premium to the freeholder for the lease extension to be between £31,400 and £36,200 plus expenses.
In 2009 we were contacted by Mrs S Mason who, having acquired a first floor flat in Wooler in May 2002. The dilemma was if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Identical homes in Wooler with 100 year plus lease were worth £235,200. The mid-range amount of ground rent was £45 invoiced per annum. The lease came to a finish in 2091. Having 66 years remaining we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including expenses.