The basic rule is, all other factors being equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Shadwell can extend the lease for an additional ninety years in accordance with Leasehold Reform legislation. Do give careful consideration before delaying your Shadwell lease extension. Putting off the costs today simply increases the amount you will ultimately be required to pay to extend the lease.
Leasehold residencies in Shadwell with in excess of 100 years outstanding on the lease are often 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 to be gained by buying the reversionary interest unless savings on ground rent and service charges justify 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Shadwell,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Shadwell valuers.
In the wake of eight months of protracted discussions with the landlord of her ground floor flat in Shadwell, Olivia started the lease extension process just as her lease was coming close to the critical eighty-year threshold. The lease extension was concluded in July 2015. The landlord’s charges were restricted to below 700 GBP.
Last Winter we were phoned by Mr Ben Thomas , who was assigned a lease of a newly refurbished flat in Shadwell in January 2007. We are asked if we could estimate the price would be to prolong the lease by 90 years. Identical flats in Shadwell with a long lease were worth £295,000. The mid-range amount of ground rent was £45 invoiced annually. The lease termination date was on 8 September 2099. Having 75 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including legals.
An example of a Freehold Enfranchisement matter before the tribunal for a Shadwell flat is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case affected 3 flats. The unexpired term as at the valuation date was 101.61 years.