On the balance of probabilities where you own a flat in Chorley you actually own a long leasehold interest over your property
Leasehold premises in Chorley with in excess of 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value 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 |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
The conveyancers that we work with undertake Chorley 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.
In recent months Ollie, came very close to the eighty-year threshold with the lease on his one bedroom flat in Chorley. In buying his flat two decades ago, the unexpired term was of no relevance. Fortunately, he became aware that he would soon be paying way over the odds for a lease extension. Ollie arranged for a lease extension just ahead of time in June. Ollie and the freeholder via the managing agents ultimately agreed on a premium of £6,000 . If the lease had slid lower than eighty years, the sum would have increased by at least £1,125.
In 2009 we were e-mailed by Mr T Cox who, having owned a garden flat in Chorley in November 2008. We are asked if we could shed any light on how much (approximately) premium would be to prolong the lease by an additional years. Similar premises in Chorley with an extended lease were valued about £250,400. The average amount of ground rent was £65 billed every twelve months. The lease elapsed on 21 March 2089. Given that there were 64 years as a residual term we calculated the premium to the landlord to extend the lease to be within £19,000 and £22,000 plus professional charges.
Mrs D Ali purchased a garden apartment in Chorley in April 2010. The question was if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Similar premises in Chorley with a long lease were valued about £184,000. The average ground rent payable was £55 billed per annum. The lease elapsed in 2078. Considering the 53 years left we calculated the premium to the landlord for the lease extension to be within £28,500 and £33,000 exclusive of costs.