With a long leasehold property in Borrowash, you effectively rent it for a certain amount of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are fewer than eighty years left. Leasehold owners in Borrowash with a lease approaching 81 years left should seriously think of extending it without delay. Once the lease term has under 80 years left, under the relevant statute the landlord is entitled to calculate and demand a larger amount, based on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold properties in Borrowash with in excess of 100 years unexpired 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 property. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with procure Borrowash 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 2014 Joshua, came critically near to the 80-year mark with the lease on his studio flat in Borrowash. In buying his property two decades ago, the length of the lease was of no interest. Fortunately, he realised he needed to take steps soon on Extending the lease. Joshua extended the lease at the eleventh hour last May. Joshua and the freeholder via the management company eventually settled on an amount of £6,000 . If the lease had fallen below 80 years, the figure would have escalated by a minimum £1,075.
Last Spring we were approach by Mr Benjamin González , who was assigned a lease of a purpose-built apartment in Borrowash in July 2003. We are asked if we could approximate the premium would likely be for a ninety year extension to my lease. Similar flats in Borrowash with 100 year plus lease were valued around £275,000. The mid-range amount of ground rent was £55 invoiced quarterly. The lease ran out in 2102. Given that there were 77 years unexpired we approximated the premium to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of expenses.
In 2014 we were contacted by Ms W Lefèvre who, having completed a basement apartment in Borrowash in June 1997. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by ninety years. Comparable homes in Borrowash with an extended lease were valued about £183,600. The mid-range ground rent payable was £65 billed monthly. The lease finished in 2082. Considering the 57 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 exclusive of legals.