When it comes to domestic leasehold premises in Tiptree, you effectively rent it for a certain amount of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially once there are less than 80 years remaining. Residents in Tiptree with a lease nearing 81 years remaining should seriously think of extending it sooner as opposed to later. When the lease term has below eighty years left, under the current Act the freeholder can calculate and levy a larger amount, based on a technical calculation, strangely termed as “marriage value” which is payable.
It is generally accepted that a property with over one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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Regardless of whether you are a tenant or a freeholder in Tiptree,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Tiptree valuers.
During the course of the last few months Theo, started to get near to the 80-year threshold with the lease on his purpose- built flat in Tiptree. Having bought his flat 18 years previously, the length of the lease was of minimal bearing. Thankfully, he recognised he needed to take steps soon on Extending the lease. Theo was able to extend his lease just ahead of time last January. Theo and the landlord eventually agreed on a premium of £5,500 . If he not met the deadline, the amount would have become more costly by a minimum £1,000.
Mr Stanley François owned a one bedroom apartment in Tiptree in January 2002. The dilemma was if we could shed any light on how much (approximately) premium would be to prolong the lease by 90 years. Comparative homes in Tiptree with 100 year plus lease were valued around £270,000. The mid-range ground rent payable was £55 invoiced quarterly. The lease came to a finish in 2100. Taking into account 74 years left we calculated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus expenses.
Last Christmas we were contacted by Mr and Mrs. F Miller , who completed a purpose-built flat in Tiptree in August 2005. The question was if we could approximate the compensation to the landlord would likely be to prolong the lease by ninety years. Similar homes in Tiptree with an extended lease were worth £166,400. The mid-range ground rent payable was £60 invoiced yearly. The lease elapsed in 2080. Given that there were 54 years remaining we approximated the compensation to the landlord to extend the lease to be within £32,300 and £37,400 exclusive of fees.