Chances are that if you own a flat in Coulsdon you actually own a long leasehold interest over your property
Leasehold premises in Coulsdon with in excess of 100 years remaining 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 premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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 lawyers that we work with procure Coulsdon 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 conveyancer we work with provide it.
Last year Hugo, came very close to the 80-year threshold with the lease on his basement apartment in Coulsdon. Having purchased his flat two decades ago, the unexpired term was of little relevance. by good luck, he became aware that he would soon be paying an escalated premium for Extending the lease. Hugo extended the lease at the eleventh hour last August. Hugo and the landlord subsequently settled on an amount of £5,500 . If the lease had dipped to less than eighty years, the premium would have become more exhorbitant by at least £1,075.
In 2013 we were called by Dr J Adams who, having took over the lease of a one bedroom apartment in Coulsdon in October 2006. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparable residencies in Coulsdon with 100 year plus lease were worth £227,800. The average amount of ground rent was £45 collected quarterly. The lease lapsed in 2091. Considering the 65 years left we calculated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 not including costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Coulsdon flat is 223 Brighton Road in September 2013. The premium payable for the acquisition freehold of the properties should be £10,934 (Ten thousand,nine hundred and thirty four pounds) This case affected 3 flats. The unexpired term was 75 years.