Stotfold leases on residential properties are gradually losing value. if your lease has in the region of 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 incurring an additional element called marriage value. Leasehold owners in Stotfold will usually qualify for a lease extension; however It would be wise to check with a lawyer to check your eligibility. In some cases you may not qualify. There are prescribed timetables and procedures to follow once the process has started so it’s sensible to be guided by a lawyer during the process.
Leasehold residencies in Stotfold with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| 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. |
Engaging our service gives you increased control over the value of your Stotfold leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jonathan owned a studio flat in Stotfold being sold with a lease of a little over 61 years unexpired. Jonathan on an informal basis spoke with his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £100 yearly. No ground rent would be payable on a lease extension were Jonathan to exercise his statutory right. Jonathan obtained expert advice and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
In 2013 we were approached by Mr and Mrs. F Turner who, having completed a recently refurbished flat in Stotfold in March 1996. The dilemma was if we could approximate the premium would likely be to prolong the lease by a further 90 years. Comparable premises in Stotfold with 100 year plus lease were worth £216,000. The average ground rent payable was £60 billed annually. The lease concluded on 5 May 2084. Considering the 58 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 not including legals.
Last February we were contacted by Dr Katie Walker , who acquired a recently refurbished apartment in Stotfold in August 2007. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year extension to my lease. Identical residencies in Stotfold with 100 year plus lease were valued around £205,000. The average ground rent payable was £50 invoiced quarterly. The lease elapsed on 16 January 2104. Given that there were 78 years unexpired we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 not including costs.