Owning a flat usually means owning a lease of the property, which has a finite term of years. This lease will usually be granted for a prescribed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Mossley. Clearly, the period of lease left reduces as time goes by. This is often overlooked and only becomes a problem when the flat or house needs to be disposed of or re-mortgaged. The fewer the years remaining the lower the value of the property and the more it will cost to procure a lease extension. Eligible long lease owners in Mossley have the right to extend the lease for an additional ninety years under statute. You should give due consideration before putting off your Mossley lease extension. Holding off the cost now likely increases the price you will ultimately have to pay for a lease extension
Leasehold premises in Mossley with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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. |
The conveyancers that we work with undertake Mossley 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 conveyancer we work with provide it.
Subsequent to protracted negotiations with the freeholder of her garden apartment in Mossley, Gemma started the lease extension process as the 80 year deadline was fast nearing. The legal work was finalised in July 2011. The freeholder’s fees were kept to an absolute minimum.
In 2014 we were contacted by Mr and Mrs. L Ramírez who, having purchased a garden flat in Mossley in January 2010. The question was if we could approximate the price would be to extend the lease by 90 years. Identical homes in Mossley with a long lease were worth £183,600. The average ground rent payable was £65 collected quarterly. The lease expired on 16 February 2082. Having 57 years remaining we estimated the compensation to the freeholder to extend the lease to be within £28,500 and £33,000 not including professional charges.
Mr and Mrs. N Dupont acquired a ground floor flat in Mossley in September 1998. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by an additional years. Comparable properties in Mossley with an extended lease were in the region of £245,000. The average amount of ground rent was £50 invoiced yearly. The lease ran out on 9 April 2093. Considering the 68 years unexpired we calculated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of legals.