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Main reasons to commence your Mitcham lease extension

Top reasons for lease extension now:

A Mitcham lease depreciates with the years remaining on the lease.

The only way is down when it comes to Mitcham lease terms. Mitcham leaseholds that have a residual term shorter than eighty years will reduce in market price at a rapid rate, and the cost to extend your lease will go up.

Mitcham property with a lease extension is almost the same value as a freehold

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

Mortgage lenders will not grant a mortgage on a short lease

Almost all banks and building societies will be unwilling to lend on a lease with under 70 years left to run - although this varies from lender to lender. A buyer will likely find it difficult to obtain a mortgage and this will result in your Mitcham property being difficult to dispose of or refinance.

Lender Requirement
Birmingham Midshires Minimum 70 years from the date of the mortgage.
Leeds Building Society 85 years remaining from the start of the mortgage.
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.

Why use us for your lease extension in Mitcham?

The conveyancers that we work with undertake Mitcham 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 lawyer we work with provide it.

Mitcham Lease Extension Case Summaries:

Rachael, Mitcham, South West London,

Trailing lengthy discussions with the landlord of her ground floor flat in Mitcham, Rachael commenced the lease extension process as the 80 year mark was quickly nearing. The legal work completed in February 2006. The freeholder’s charges were kept to an absolute minimum.

Mitcham case:

Dr Samuel Robinson acquired a purpose-built flat in Mitcham in July 2000. We are asked if we could estimate the price would be to prolong the lease by a further 90 years. Comparative properties in Mitcham with 100 year plus lease were valued around £210,000. The average ground rent payable was £50 collected monthly. The lease elapsed on 4 August 2105. Taking into account 80 years remaining we calculated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 not including professional charges.

Decision in Wandsworth

An example of a Freehold Enfranchisement decision for a Mitcham premises is 50 & 52 Southcroft Road in September 2013. The tribunals own valuation determined that the premium payable should be £29,000 This case was in relation to 2 flats. The unexpired residue of the current lease was 86.11 and 60.64.