When it comes to long leasehold property in Fowey, you are actually purchasing an entitlement to reside in a property for a set period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should think about extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably once there are less than eighty years remaining. Anyone in Fowey with a lease approaching 81 years remaining should seriously consider extending it without delay. When a lease has below eighty years remaining, under the current legislation the freeholder can calculate and charge a larger premium, assessed on a technical multiplication, known as “marriage value” which is due.
Leasehold residencies in Fowey with over one hundred years remaining 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 to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant 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 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service gives you better control over the value of your Fowey leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Connor was the the leasehold proprietor of a 2 bedroom flat in Fowey on the market with a lease of a little over 72 years outstanding. Connor on an informal basis approached his landlord a well known London-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Connor to exercise his statutory right. Connor procured expert advice and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Mr P Peterson moved into a purpose-built flat in Fowey in April 1999. The dilemma was if we could approximate the compensation to the landlord could be to prolong the lease by ninety years. Comparable residencies in Fowey with an extended lease were in the region of £235,200. The mid-range amount of ground rent was £45 invoiced yearly. The lease lapsed on 15 May 2091. Having 66 years unexpired we estimated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including costs.
In 2011 we were phoned by Mr E Phillips who, having moved into a newly refurbished apartment in Fowey in September 1996. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Similar residencies in Fowey with an extended lease were in the region of £275,000. The average ground rent payable was £55 collected quarterly. The lease finished on 10 October 2102. Having 77 years unexpired we estimated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including costs.