Ramsey leases on domestic deteriorating in value. Where your lease has about 90 years unexpired, you should start thinking about a lease extension. Eighty years is a significant number: when the remaining term of a lease dips below this level then you begin paying an additional element called marriage value. Leasehold owners in Ramsey will usually qualify for a lease extension; however It would be wise to check with a lawyer to confirm if you qualify. In certain situations you may not qualify. There are also strict deadlines and formalities to comply with once the process has started so it’s best to be guided by a lawyer during the process.
It is generally accepted that a property with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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 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. |
| 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. |
Engaging our service gives you enhanced control over the value of your Ramsey leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Max owned a conversion flat in Ramsey on the market with a lease of a few days over 72 years remaining. Max informally approached his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £200 yearly. No ground rent would be due on a lease extension were Max to exercise his statutory right. Max obtained expert advice and was able to make an informed decision and deal with the matter and readily saleable.
Last June we were contacted by Dr Cameron Rodríguez , who purchased a basement flat in Ramsey in April 1999. We are asked if we could shed any light on how much (approximately) price would be to extend the lease by 90 years. Comparable properties in Ramsey with 100 year plus lease were worth £285,000. The average amount of ground rent was £45 billed annually. The lease elapsed in 2097. Considering the 71 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus professional charges.
Last year we were e-mailed by Mr and Mrs. L Bailey , who acquired a garden flat in Ramsey in March 2003. The dilemma was if we could estimate the premium would be for a ninety year lease extension. Comparable residencies in Ramsey with a long lease were worth £230,800. The average ground rent payable was £60 collected monthly. The lease lapsed on 22 October 2086. Considering the 60 years left we approximated the compensation to the landlord to extend the lease to be within £24,700 and £28,600 not including professional charges.