On the balance of probabilities if you own a flat in Epping you actually own a long leasehold interest over your property
Leasehold properties in Epping with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Epping,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Epping valuers.
Subsequent to unsuccessful discussions with the landlord of her purpose-built flat in Epping, Bethan started the lease extension process just as the lease was nearing the all-important eighty-year threshold. The transaction was finalised in January 2014. The freeholder’s costs were negotiated to less than 550 GBP.
In 2012 we were approached by Mr and Mrs. B Bernard who, having purchased a garden flat in Epping in November 1995. The dilemma was if we could approximate the premium would likely be for a 90 year extension to my lease. Similar premises in Epping with 100 year plus lease were worth £166,400. The average amount of ground rent was £60 billed quarterly. The lease lapsed on 16 May 2078. Having 54 years left we approximated the compensation to the freeholder for the lease extension to be between £32,300 and £37,400 plus expenses.
Last Christmas we were approach by Mrs T Cox , who acquired a basement flat in Epping in October 1996. The question was if we could approximate the price could be to prolong the lease by ninety years. Similar homes in Epping with 100 year plus lease were in the region of £227,800. The average ground rent payable was £45 invoiced yearly. The lease came to a finish in 2089. Taking into account 65 years outstanding we approximated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of costs.