Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will normally be granted for a prescribed period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Temple Fortune. Inevitably, the length of lease remaining shortens as time goes by. This is often overlooked and only raises itself as an issue when the residence has to be disposed of or re-mortgaged. The fewer the years remaining the lower the value of the property and the more expensive it will be to extend the lease. Eligible leaseholders in Temple Fortune have the legal entitlement to extend the lease for a further 90 years in accordance with Leasehold Reform legislation. Please give careful attention before putting off your Temple Fortune lease extension. Putting off the cost now simply increases the price you will ultimately have to pay to extend your lease
Leasehold residencies in Temple Fortune with over 100 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 buying the reversionary interest unless savings on ground rent and estate 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. |
| 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. |
| 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. |
| 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 |
| 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. |
Retaining our service gives you increased control over the value of your Temple Fortune leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Milo owned a studio flat in Temple Fortune on the market with a lease of a few days over 59 years remaining. Milo informally spoke with his landlord a well known local-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 subject to a rise in the rent to £50 annually. Ordinarily, ground rent would not be payable on a lease extension were Milo to invoke his statutory right. Milo procured expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
Last Winter we were called by Mr and Mrs. W Vincent , who completed a newly refurbished apartment in Temple Fortune in April 1999. The question was if we could estimate the premium would likely be for a ninety year lease extension. Similar properties in Temple Fortune with an extended lease were valued around £257,800. The average amount of ground rent was £65 invoiced quarterly. The lease ran out on 25 September 2090. Given that there were 65 years outstanding we estimated the premium to the landlord for the lease extension to be within £18,100 and £20,800 exclusive of fees.
An example of a Lease Extension case for a Temple Fortune premises is Flat 2 2 Netherfield Road in April 2010. The Tribunale held that premium payable for a 90 year extension to the existing Lease should be £7,705. This case related to 1 flat. The unexpired term as at the valuation date was 76 years.