The re-sale value of a leasehold property in Totteridge is impacted by how long the lease has left to run. If it is close to or fewer than 80 years you should foresee problems on re-sale, so it is recommended to arrange for the lease to be extended before buying. It is preferable to start the process of extending the lease is when a lease still has 82 years remaining so that formalities can be addressed well before the 80 year threshold. Statute entitles Totteridge qualifying lessees to an additional term of ninety years on top of the remaining term, at a peppercorn rent (zero ground rent). The purpose of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Totteridge with more than 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
The lawyers that we work with undertake Totteridge 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.
Off the back of lengthy discussions with the freeholder of her leasehold flat in Totteridge, Rebecca initiated the lease extension process as the 80 year threshold was rapidly approaching. The transaction was concluded in March 2010. The freeholder’s fees were negotiated to about 500 pounds.
In 2014 we were e-mailed by Mr C Kelly who, having bought a first floor apartment in Totteridge in August 2007. The dilemma was if we could estimate the premium would likely be for a 90 year extension to my lease. Comparative flats in Totteridge with an extended lease were worth £166,800. The mid-range ground rent payable was £50 invoiced per annum. The lease came to a finish on 26 January 2076. Considering the 50 years outstanding we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 plus professional charges.
An example of a Lease Extension matter before the tribunal for a Totteridge residence 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 affected 1 flat. The unexpired lease term was 76 years.