When it comes to long leasehold premises in Grays, you are actually purchasing an entitlement to live in a property for a set period of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially when there are less than eighty years left. Leasehold owners in Grays with a lease drawing near to 81 years unexpired should seriously think of extending it as soon as possible. When a lease has under eighty years remaining, under the current Act the landlord can calculate and demand a larger premium, assessed on a technical computation, strangely termed as “marriage value” which is due.
Leasehold properties in Grays with more than one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate 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. |
| 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; |
| 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. |
The conveyancing solicitors that we work with undertake Grays 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 conveyancing solicitor we work with provide it.
In 2014 Arthur, started to get near to the eighty-year threshold with the lease on his two bedroom flat in Grays. In buying his home two decades ago, the unexpired term was of little relevance. Luckily, he realised he needed to take steps soon on Extending the lease. Arthur arranged for a lease extension just under the wire last May. Arthur and the landlord subsequently settled on sum of £5,000 . If the lease had dropped below 80 years, the figure would have become more costly by a minimum £1,075.
Mr and Mrs. H Peterson bought a basement apartment in Grays in November 2009. We are asked if we could approximate the price could be for a 90 year extension to my lease. Identical homes in Grays with an extended lease were worth £235,200. The average ground rent payable was £45 billed every twelve months. The lease came to a finish on 4 November 2091. Considering the 66 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.
An example of a Lease Extension case for a Grays property is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case was in relation to 13 flats. The number of years remaining on the existing lease(s) was 76 years.