When it comes to long leasehold premises in Pentwyn, you effectively rent it for a certain period of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you may think about extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are fewer than eighty years left. Residents in Pentwyn with a lease approaching 81 years unexpired should seriously consider extending it without delay. When a lease has less than eighty years left, under the current statute the freeholder is entitled to calculate and levy a greater amount, assessed on a technical computation, known as “marriage value” which is payable.
Leasehold residencies in Pentwyn with over 100 years left on the lease are often 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 to be gained by purchasing the reversionary interest unless savings on ground rent and service charges merit 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 are not acceptable. 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with handle Pentwyn 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 lawyer we work with provide it.
In 2014 Jude, started to get near to the eighty-year mark with the lease on his purpose- built apartment in Pentwyn. In buying his home two decades ago, the unexpired term was of no concern. by good luck, it dawned on him that he needed to take action soon on a lease extension. Jude arranged for a lease extension just in the nick of time in August. Jude and the freeholder in the end agreed on a premium of £6,000 . If he failed to meet the deadline, the amount would have escalated by a minimum £950.
Mr and Mrs. E King bought a purpose-built flat in Pentwyn in September 1996. The dilemma was if we could approximate the premium would be for a 90 year lease extension. Comparative flats in Pentwyn with a long lease were in the region of £275,000. The mid-range amount of ground rent was £65 collected annually. The lease finished on 25 July 2094. Given that there were 68 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 plus costs.
Last March we were approach by Mr and Mrs. C Hill , who acquired a one bedroom flat in Pentwyn in September 2009. The question was if we could estimate the premium could be for a 90 year lease extension. Comparable premises in Pentwyn with 100 year plus lease were valued around £208,600. The average ground rent payable was £60 collected every twelve months. The lease termination date was in 2083. Given that there were 57 years remaining we estimated the premium to the landlord to extend the lease to be between £30,400 and £35,200 not including expenses.