Brentwood leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Brentwood residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Brentwood you really ought to investigate if your lease has between 70 and 90 years left. There are good reasons why a Brentwood flat owner with a lease having around eighty years remaining should take action to make sure that a lease extension is put in place without delay
Leasehold premises in Brentwood with in excess of one hundred years left 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 home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 better control over the value of your Brentwood leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Following unsuccessful discussions with the freeholder of her purpose-built apartment in Brentwood, Holly started the lease extension process as the 80 year threshold was rapidly approaching. The legal work was concluded in July 2014. The freeholder’s charges were kept to an absolute minimum.
Last Summer we were called by Mr and Mrs. C Cox , who bought a basement flat in Brentwood in September 2004. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical residencies in Brentwood with 100 year plus lease were worth £176,200. The average amount of ground rent was £65 collected yearly. The lease lapsed in 2082. Having 56 years left we calculated the premium to the landlord for the lease extension to be between £29,500 and £34,000 exclusive of professional charges.
An example of a Lease Extension case for a Brentwood flat is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case affected 1 flat. The unexpired residue of the current lease was 57.5 years.