The nearer a residential lease in Accrington gets to zero years unexpired, the the greater the reduction in the value of the property. Where the residual term has, in excess of one hundred years to run then this decrease may be fractional however there will become a stage when a lease has under than eighty years remaining as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the primary rational as to why you should extend the lease sooner than later. Many flat owners in Accrington will meet the qualifying criteria; nevertheless a conveyancing solicitor can advise if you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Accrington with over 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
Using our service gives you enhanced control over the value of your Accrington leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Theo, came seriously near to the 80-year mark with the lease on his garden flat in Accrington. In buying his flat twenty years ago, the lease term was of minimal relevance. As luck would have it, he realised he would imminently be paying an escalated premium for a lease extension. Theo arranged for a lease extension at the eleventh hour last July. Theo and the freeholder via the management company eventually settled on an amount of £5,500 . If the lease had slid below eighty years, the amount would have escalated by at least £925.
Mr C Howard completed a purpose-built apartment in Accrington in April 2006. We are asked if we could approximate the premium would likely be to prolong the lease by ninety years. Comparative homes in Accrington with 100 year plus lease were valued around £183,600. The mid-range ground rent payable was £65 collected monthly. The lease lapsed in 2083. Given that there were 57 years as a residual term we estimated the premium to the landlord to extend the lease to be within £28,500 and £33,000 plus costs.
Last Summer we were phoned by Mr and Mrs. V Brooks , who bought a one bedroom apartment in Accrington in April 1996. The dilemma was if we could shed any light on how much (roughly) premium would likely be to prolong the lease by 90 years. Identical homes in Accrington with an extended lease were in the region of £245,000. The mid-range amount of ground rent was £50 invoiced quarterly. The lease came to a finish in 2094. Taking into account 68 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including costs.