Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will ordinarily be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Ramsey. Clearly, the term of lease left shortens over time. This is often ignored and only becomes a problem when the property has to be sold or refinanced. 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 Ramsey have the legal entitlement to extend the lease for an additional 90 years under the 1993 Leasehold Reform Act. You should give due attention before putting off your Ramsey lease extension. Putting off that expense now simply increases the price you will ultimately have to pay to extend your lease
It is generally considered that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Ramsey can be a difficult process. We recommend you secure professional help from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Ramsey lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last year David, came very near to the 80-year mark with the lease on his basement apartment in Ramsey. In buying his flat twenty years ago, the length of the lease was of little relevance. Luckily, it dawned on him that he needed to take action soon on Extending the lease. David arranged for a lease extension just in the nick of time last August. David and the landlord who owned the flat above ultimately settled on an amount of £5,000 . If he had missed the deadline, the premium would have gone up by at least £1,150.
Last Winter we were approach by Mr and Mrs. W Cox , who moved into a basement flat in Ramsey in August 2008. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by a further 90 years. Comparable properties in Ramsey with an extended lease were worth £210,000. The average ground rent payable was £50 collected quarterly. The lease concluded on 6 May 2106. Taking into account 80 years left we approximated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of professional charges.
Ms J Johnson acquired a one bedroom apartment in Ramsey in June 2002. We are asked if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Similar homes in Ramsey with a long lease were worth £280,000. The average ground rent payable was £45 billed yearly. The lease finished in 2095. Considering the 69 years outstanding we approximated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of fees.