Merton Park Lease Extension - Free Consultation

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Main reasons to commence your Merton Park lease extension


Why you should start your Merton Park lease extension today:

A Merton Park leasehold property depreciates with the years remaining on the lease.

Merton Park residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a set term.

Merton Park property with a lease extension has roughly the same value as a freehold

It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.

Banks and Building Societies will not issue a mortgage on a short lease

Banks and Building Societies have set criteria when lending funds charged on leasehold homes. Some will simply refrain from lending at all once the remaining lease term slips lower than a specified unexpired lease term. Many Mortgage lenders will not regard property with an unexpired below seventy years suitable security. In addition to this being important when selling, it is also relevant where you are wanting to refinance your Merton Park home.

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;
Birmingham Midshires Minimum 70 years from the date of the mortgage.
Halifax Minimum 70 years from the date 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.
Royal Bank of Scotland Mortgage term plus 30 years.

Get in touch with one of our Merton Park lease extension solicitors or enfranchisement solicitors

Irrespective of whether you are a tenant or a landlord in Merton Park,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Merton Park valuers.

Merton Park Lease Extension Example Cases:

Nathan, Merton Park, South West London

Two years ago Nathan, came seriously near to the eighty-year threshold with the lease on his garden apartment in Merton Park. Having purchased his home two decades ago, the unexpired term was of minimal interest. Thankfully, he realised he needed to take action soon on a lease extension. Nathan extended the lease just under the wire in April. Nathan and the freeholder in the end agreed on an amount of £5,000 . If he had missed the deadline, the amount would have increased by a minimum £850.

Merton Park case:

Mrs C Smith bought a studio flat in Merton Park in September 2009. The dilemma was if we could shed any light on how much (roughly) premium could be to prolong the lease by 90 years. Similar properties in Merton Park with a long lease were valued around £233,200. The mid-range ground rent payable was £60 billed monthly. The lease finished in 2086. Considering the 61 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £22,800 and £26,400 exclusive of expenses.

Decision in Wandsworth

An example of a Lease Extension matter before the tribunal for a Merton Park flat is 14 Nutwell Street in January 2014. The premium payable for the acquisition of a new lease of the subject premises was in the sum of £30,523 This case was in relation to 1 flat. The remaining number of years on the lease was 62.94 years.