Wimborne leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Wimborne residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Wimborne you really ought to see if your lease has between seventy and ninety years left. There are compelling reasons why a Wimborne flat owner with a lease having around eighty years remaining should take action to make sure that a lease extension is effected without delay
Leasehold residencies in Wimborne with in excess of one hundred years remaining on the lease are sometimes 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 upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| 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. |
| Coventry Building Society | 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with undertake Wimborne 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.
Jack was the the leasehold owner of a high value apartment in Wimborne being marketed with a lease of fraction over 72 years remaining. Jack informally contacted his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Jack to exercise his statutory right. Jack procured expert advice and secured satisfactory resolution informally and readily saleable.
In 2012 we were e-mailed by Mrs Georgina Turner who, having was assigned a lease of a first floor apartment in Wimborne in August 1995. The question was if we could estimate the compensation to the landlord would be to prolong the lease by 90 years. Comparable flats in Wimborne with an extended lease were in the region of £198,800. The average amount of ground rent was £55 collected every twelve months. The lease ended in 2080. Having 55 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £33,300 and £38,400 exclusive of expenses.
Last Christmas we were contacted by Mrs Elizabeth Bertrand , who was assigned a lease of a first floor flat in Wimborne in November 2001. The question was if we could estimate the premium would be for a ninety year lease extension. Identical homes in Wimborne with an extended lease were in the region of £295,000. The average amount of ground rent was £50 invoiced yearly. The lease finished on 8 August 2100. Taking into account 75 years left we estimated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 not including professional charges.