With a residential leasehold premises in Aston, you are actually buying an entitlement to live in a property for a set period of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease becomes disproportionately more expensive particularly once there are fewer than eighty years left. Leasehold owners in Aston with a lease drawing near to 81 years left should seriously think of extending it sooner as opposed to later. Once a lease has fewer than 80 years outstanding, under the current Act the landlord is entitled to calculate and levy a greater premium, based on a technical calculation, strangely termed as “marriage value” which is payable.
Leasehold premises in Aston with in excess of one hundred 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 premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance 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; |
| 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. |
| Halifax | Minimum 70 years from the date 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Aston can be a difficult process. We recommend you get guidance from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Aston lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Michael was the the leasehold owner of a 2 bedroom apartment in Aston being marketed with a lease of a little over 61 years unexpired. Michael on an informal basis contacted his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £200 per annum. No ground rent would be due on a lease extension were Michael to invoke his statutory right. Michael procured expert legal guidance and was able to make a more informed decision and deal with the matter and readily saleable.
Last Winter we were called by Ms J Bernard , who purchased a ground floor flat in Aston in November 2010. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical homes in Aston with a long lease were in the region of £260,000. The average amount of ground rent was £50 invoiced annually. The lease lapsed on 27 November 2098. Given that there were 73 years as a residual term we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of legals.
Last year we were phoned by Mr and Mrs. G Wood , who was assigned a lease of a one bedroom flat in Aston in September 2010. We are asked if we could estimate the premium would likely be to extend the lease by 90 years. Comparable residencies in Aston with an extended lease were in the region of £264,000. The mid-range ground rent payable was £60 collected monthly. The lease finished in 2078. Taking into account 53 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £37,100 and £42,800 exclusive of costs.