For anyone whose Dunmow home is held on a long lease, the message is clear – if no remedial action is taken, the property will ultimately revert to your landlord, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to extend the lease.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| 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. |
The lawyers that we work with undertake Dunmow 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.
Noah was the the leasehold proprietor of a high value flat in Dunmow on the market with a lease of fraction over 72 years left. Noah informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Noah to invoke his statutory right. Noah obtained expert legal guidance and was able to make a more informed decision and handle with the matter and readily saleable.
Last year we were approach by Mr and Mrs. J Sharif , who was assigned a lease of a one bedroom flat in Dunmow in February 2009. The dilemma was if we could approximate the premium would be to prolong the lease by an additional years. Identical premises in Dunmow with a long lease were valued around £205,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease ran out in 2105. Having 79 years left we calculated the premium to the landlord for the lease extension to be between £8,600 and £9,800 not including fees.
Mrs Gemma Rivera owned a one bedroom flat in Dunmow in January 2000. We are asked if we could estimate the price would be to extend the lease by ninety years. Comparable homes in Dunmow with an extended lease were in the region of £275,000. The average amount of ground rent was £65 collected monthly. The lease ran out on 15 February 2094. Considering the 68 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 not including expenses.