It’s a harsh truth that a Lanchester residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Lanchester property market.Once your lease gets to 85ish years, you need to start thinking about a lease extension. If lease term drops below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most flat owners in Lanchester will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold residencies in Lanchester with over 100 years unexpired 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 purchasing the freehold 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; |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Lease extensions in Lanchester can be a difficult process. We recommend you get professional help from a conveyancing solicitor and surveyor with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Lanchester lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Half a year ago Samuel, came very close to the 80-year mark with the lease on his purpose- built flat in Lanchester. In buying his property 18 years ago, the unexpired term was of no relevance. Luckily, he noticed he needed to take steps soon on Extending the lease. Samuel extended the lease just in the nick of time in April. Samuel and the freeholder in the end agreed on sum of £6,000 . If he not met the deadline, the sum would have gone up by at least £925.
Mr and Mrs. L Baker purchased a studio flat in Lanchester in May 1995. We are asked if we could approximate the compensation to the landlord would be for a 90 year lease extension. Comparative homes in Lanchester with an extended lease were worth £166,400. The average amount of ground rent was £60 invoiced yearly. The lease expired on 5 July 2078. Taking into account 54 years remaining we estimated the premium to the freeholder for the lease extension to be within £32,300 and £37,400 exclusive of expenses.
In 2009 we were contacted by Mr and Mrs. D Brown who, having owned a one bedroom apartment in Lanchester in May 1997. We are asked if we could approximate the price would likely be for a 90 year extension to my lease. Identical flats in Lanchester with an extended lease were valued around £232,800. The average amount of ground rent was £45 collected every twelve months. The lease came to a finish on 28 January 2089. Taking into account 65 years outstanding we calculated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of expenses.