Tilbury residential property owned on a long lease is a wasting asset because a leaseholder only owns the property for a period of years.
Leasehold residencies in Tilbury with more than 100 years unexpired 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 situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Using our service will provide you better control over the value of your Tilbury leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy correspondence with the freeholder of her two bedroom flat in Tilbury, Katherine initiated the lease extension process just as her lease was nearing the all-important 80-year threshold. The lease extension was finalised in February 2012. The freeholder’s charges were negotiated to about 600 GBP.
Last Spring we were contacted by Mr and Mrs. B Allen , who completed a newly refurbished apartment in Tilbury in November 2008. The dilemma was if we could approximate the price would be for a 90 year lease extension. Identical residencies in Tilbury with an extended lease were valued around £216,000. The average ground rent payable was £60 invoiced monthly. The lease concluded on 26 November 2082. Considering the 58 years outstanding we calculated the premium to the landlord to extend the lease to be within £28,500 and £33,000 not including expenses.
Mrs F Leroy purchased a one bedroom apartment in Tilbury in November 1995. The question was if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Identical residencies in Tilbury with 100 year plus lease were valued around £205,000. The mid-range ground rent payable was £50 billed annually. The lease terminated in 2102. Having 78 years unexpired we calculated the compensation to the landlord for the lease extension to be within £7,600 and £8,800 not including legals.