What are Leasehold Extensions?
A lease is a right to use the property for a period of time. As a lease gets shorter the value of the lease decreases and it becomes more expensive to extend the lease. This is why it is often a good idea to increase the term of the lease.
Sometimes it is difficult to sell a property with a short lease because mortgage lenders may be reluctant to lend money on such properties.
New leases today are often granted for periods of 125 years. However, many leaseholds were granted for periods of between 99 and 999 years.
In order to be suitable for a mortgage to be taken out on a property, lenders will often insist that the lease has a minimum period to run. The exact number of years will vary from lender to lender. You can check what minimum term is acceptable to your lender by contacting them.
In addition, if you are selling your home, you may find that buyers may be reluctant to buy a property where the lease has fewer than 60-70 years to run as they themselves may have difficulty in obtaining a mortgage or reselling it. In these cases, a buyer may insist that the lease is extended as a condition of buying your property.
Extending a lease can be a difficult process and if you’re planning to obtain a mortgage or sell your property it pays to get advice early.
Leasehold Extension Costs
There are two types of costs involved in extending a lease. These are the legal costs and other expenses you may have to pay and the cost of the lease extension itself.
Legal Costs & Expenses
There is no guaranteed fixed figure, please contact us for a quote.
There will also be a land registry fee of £40.00 to register the extension and, if you have a mortgage over your home, then the consent of the mortgage lender will need to be given. A charge is likely to be made for this which will need to be confirmed by your mortgage lender.
Landlord / Freeholder Charges
The Leasehold Advisory Service, which is funded by the Government, has a Lease Extension Calculator online which can be used to give a general guide as to the cost a landlord or freeholder may expect for extending or renewing a lease. But it cannot give you the actual costs.
Therefore, you should not rely on this information in tribunal or court proceedings and neither should you take any other action based on this information without first getting professional advice.
Please note that this calculator cannot do calculations for leases with less than 60 years remaining.
Co-op Legal Services has a range of partners of specialist solicitors and conveyancers who are experts in all areas of leasehold extensions. They can guide you through the process and give you clear and simple explanations of what is involved.
Co-op Legal Services has offices in Manchester, Bristol and London.