The market value of a leasehold property in Pencader is impacted by how many years the lease has left to run. If it is near to or less than eighty years you should expect problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of buying. It is preferable to start the lease extension process when a lease still has 82 years unexpired so that all matters can be finalised ahead of the eighty year mark. Leasehold Reform legislation entitles Pencader qualifying lessees to an additional term of 90 years in addition to the existing term, at a nominal rent (zero ground rent). The reason of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Pencader with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value 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 service charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Chelsea 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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 |
The lawyers that we work with undertake Pencader 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.
After protracted negotiations with the landlord of her studio apartment in Pencader, Sian commenced the lease extension process as the 80 year threshold was swiftly advancing. The legal work completed in July 2008. The landlord’s fees were negotiated to approximately 450 pounds.
Mr and Mrs. G Peterson purchased a first floor apartment in Pencader in September 1998. We are asked if we could estimate the price would likely be to prolong the lease by a further 90 years. Identical residencies in Pencader with an extended lease were in the region of £280,000. The mid-range ground rent payable was £55 invoiced per annum. The lease lapsed in 2103. Having 77 years left we calculated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 plus fees.
In 2010 we were phoned by Mr and Mrs. P Moore who, having was assigned a lease of a ground floor flat in Pencader in July 1997. We are asked if we could estimate the premium would be to extend the lease by a further 90 years. Similar residencies in Pencader with an extended lease were in the region of £183,600. The mid-range ground rent payable was £65 billed monthly. The lease terminated in 2083. Having 57 years remaining we calculated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 not including expenses.