There is no doubt about it a leasehold flat or house in Beacontree Heath is a wasting asset as a result of the shortening lease. Where the lease has, more than 100 years remaining then this decrease may be of little impact however there will become a stage when a lease has less than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main logic behind why you should consider extending without delay. Most flat owners in Beacontree Heath will qualify for this right; that being said a lawyer should be able to confirm if you are eligible 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.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| 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; |
| 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. |
| 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 |
| 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 lawyers that we work with undertake Beacontree Heath 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 conveyancing solicitor we work with provide it.
In the wake of 6 months of lengthy discussions with the freeholder of her two bedroom flat in Beacontree Heath, Phoebe initiated the lease extension process just as the lease was nearing the crucial eighty-year threshold. The legal work was finalised in October 2015. The freeholder’s charges were kept to an absolute minimum.
Last May we were approach by Mrs Jennifer Fournier , who purchased a studio flat in Beacontree Heath in June 2009. The dilemma was if we could shed any light on how much (approximately) price would likely be to prolong the lease by an additional years. Comparable flats in Beacontree Heath with 100 year plus lease were worth £200,000. The mid-range amount of ground rent was £50 billed per annum. The lease termination date was on 5 November 2102. Having 77 years unexpired we calculated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 exclusive of professional charges.
An example of a Lease Extension matter before the tribunal for a Beacontree Heath property is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case affected 1 flat. The unexpired residue of the current lease was 61.36 years.