The value of Tedburn St Mary leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate significantly once the unexpired lease term is less than eighty years
Leasehold residencies in Tedburn St Mary with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Godiva Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
The lawyers that we work with procure Tedburn St Mary 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.
Last year Aiden, came dangerously close to the 80-year mark with the lease on his studio flat in Tedburn St Mary. In buying his flat two decades ago, the lease term was of minimal importance. Luckily, he recognised he would soon be paying an inflated amount for a lease extension. Aiden extended the lease just in the nick of time in September. Aiden and the freeholder via the managing agents ultimately agreed on a premium of £5,500 . If the lease had slipped below 80 years, the premium would have become more exhorbitant by at least £950.
Mr and Mrs. I Carter was assigned a lease of a basement flat in Tedburn St Mary in May 2011. We are asked if we could estimate the premium would likely be to prolong the lease by an additional years. Identical premises in Tedburn St Mary with an extended lease were in the region of £260,200. The average amount of ground rent was £65 collected annually. The lease concluded on 24 September 2091. Having 66 years left we approximated the compensation to the freeholder for the lease extension to be between £16,200 and £18,600 exclusive of fees.
Last Winter we were called by Dr Kate Watson , who completed a studio flat in Tedburn St Mary in October 2001. The question was if we could estimate the premium could be for a ninety year lease extension. Similar properties in Tedburn St Mary with an extended lease were valued around £198,800. The mid-range ground rent payable was £55 billed per annum. The lease concluded in 2080. Given that there were 55 years outstanding we calculated the premium to the landlord for the lease extension to be between £33,300 and £38,400 plus fees.