Holmfirth residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a set term.
Leasehold properties in Holmfirth with more than one hundred years outstanding 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 property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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. |
| Yorkshire 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. |
The conveyancing solicitors that we work with procure Holmfirth 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.
Last year Archie, came seriously near to the eighty-year threshold with the lease on his first floor flat in Holmfirth. In buying his property two decades ago, the unexpired term was of minimal relevance. Luckily, he recognised he needed to take action soon on Extending the lease. Archie extended the lease at the eleventh hour last March. Archie and the freeholder ultimately settled on a premium of £6,000 . If he had missed the deadline, the premium would have escalated by at least £1,000.
In 2009 we were contacted by Mr Aiden André who, having moved into a one bedroom flat in Holmfirth in January 2001. The question was if we could approximate the premium could be for a ninety year extension to my lease. Similar flats in Holmfirth with a long lease were in the region of £176,200. The mid-range amount of ground rent was £65 billed yearly. The lease termination date was on 20 September 2082. Given that there were 56 years left we calculated the premium to the freeholder to extend the lease to be between £29,500 and £34,000 exclusive of legals.
Last month we were phoned by Ms Alice Davis , who bought a one bedroom flat in Holmfirth in February 2007. We are asked if we could approximate the price could be to extend the lease by an additional years. Comparable homes in Holmfirth with an extended lease were valued about £242,600. The mid-range amount of ground rent was £45 billed per annum. The lease came to a finish in 2093. Given that there were 67 years unexpired we approximated the compensation to the landlord to extend the lease to be within £11,400 and £13,200 not including legals.