Thornbury leases on residential properties are gradually losing value. Where your lease has about 90 years left, you should start thinking about a lease extension. If lease term dips under eighty years, you will then have to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Thornbury will mostly qualify for a lease extension; however it’s a good idea to check with a lawyer to confirm your eligibility. In certain circumstances you may not be entitled. There are prescribed timetables and procedures to follow once the process has started so it’s prudent to be guided by a conveyancer during the process.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years left, the premises will be equivalent in value to a freehold for decades to come.
| 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 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Lease extensions in Thornbury can be a difficult process. We recommend you procure guidance from a conveyancer 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 a wealth of experience dealing with Thornbury lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Ali owned a 2 bedroom flat in Thornbury being sold with a lease of a little over 61 years remaining. Ali on an informal basis approached his landlord being a well known local-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 per annum. Ordinarily, ground rent would not be due on a lease extension were Ali to exercise his statutory right. Ali procured expert legal guidance and secured an acceptable resolution informally and sell the property.
Last Autumn we were phoned by Mr B Green , who took over the lease of a one bedroom apartment in Thornbury in November 1999. The dilemma was if we could approximate the premium could be for a ninety year lease extension. Identical properties in Thornbury with 100 year plus lease were worth £210,000. The mid-range ground rent payable was £50 collected per annum. The lease finished on 4 February 2105. Considering the 80 years left we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 not including costs.
Last year we were e-mailed by Ms Charlotte Nelson , who took over the lease of a one bedroom apartment in Thornbury in May 2004. The question was if we could estimate the compensation to the landlord would likely be to extend the lease by 90 years. Identical flats in Thornbury with an extended lease were in the region of £275,000. The mid-range ground rent payable was £45 collected monthly. The lease elapsed on 28 July 2094. Given that there were 69 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 plus costs.