The value of Brentwood leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase substantially once the remaining term is below than eighty years
Leasehold residencies in Brentwood with in excess of 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate 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; |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Brentwood 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 lawyer we work with provide it.
Subsequent to unsuccessful negotiations with the landlord of her one bedroom apartment in Brentwood, Samantha initiated the lease extension process as the 80 year deadline was fast advancing. The lease extension completed in February 2013. The freeholder’s costs were kept to an absolute minimum.
Last year we were phoned by Mr P Martin , who was assigned a lease of a newly refurbished flat in Brentwood in October 2008. The dilemma was if we could approximate the compensation to the landlord would likely be for a 90 year lease extension. Similar premises in Brentwood with 100 year plus lease were worth £250,000. The mid-range ground rent payable was £50 invoiced per annum. The lease concluded on 11 October 2094. Considering the 69 years unexpired we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 not including professional charges.
An example of a Lease Extension matter before the tribunal for a Brentwood premises 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 lease term was 57.5 years.