With a residential leasehold premises in Worksop, you are actually purchasing an entitlement to live in a property for a set period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably once there are less than 80 years remaining. Anyone in Worksop with a lease nearing 81 years remaining should seriously think of extending it without delay. When a lease has under 80 years left, under the relevant Act the landlord is entitled to calculate and charge a greater amount, based on a technical computation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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 conveyancers that we work with procure Worksop 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.
Last year Leon, started to get close to the 80-year mark with the lease on his two bedroom apartment in Worksop. In buying his home 19 years ago, the lease term was of minimal interest. As luck would have it, he became aware that he would imminently be paying an escalated premium for Extending the lease. Leon arranged for a lease extension just under the wire last July. Leon and the landlord eventually settled on a premium of £5,500 . If the lease had slipped below eighty years, the sum would have gone up by at least £925.
Last Spring we were called by Ms Maisie Morgan , who was assigned a lease of a one bedroom apartment in Worksop in January 2011. We are asked if we could approximate the compensation to the landlord would likely be for a ninety year lease extension. Comparative premises in Worksop with a long lease were in the region of £183,600. The average ground rent payable was £65 collected every twelve months. The lease expired in 2082. Having 57 years unexpired we estimated the compensation to the landlord to extend the lease to be within £28,500 and £33,000 not including fees.
Last Christmas we were approach by Dr H Cook , who completed a recently refurbished apartment in Worksop in February 1995. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by ninety years. Identical residencies in Worksop with a long lease were in the region of £242,600. The mid-range amount of ground rent was £45 collected yearly. The lease expiry date was on 16 July 2092. Taking into account 67 years remaining we calculated the premium to the freeholder for the lease extension to be between £11,400 and £13,200 not including expenses.