Lease- 75 yrs. unexpired- extension cost?

[jim child]

can anyone help. i wrote to my freeholders to get a cost on extending my lease 9 weeks ago .after various phone calls/e-mails still no reply.the flat was built in 1982 with a 99yr lease, it has 75 yrs left. how much would it be to extend the lease and how can it be done.i've looked on this site and saw marriage value??? if the freeholders do finaly come back with a figure is it set at that price.i'm in a bit of a rush as the property is on the market and i've had at least 6 viewings but all of them are concered with only 75yrs on the lease.help..:confused:

[Poppy]

Writing to the freeholder is the correct first step. You must negotiate the premium with them. There is no other way of doing it.

I recommend that you visit the Leasehold Advisory Service (http://www.lease-advice.org) website to aid your knowledge.

BTW, I think that 75 years unexpired is plenty. My guess is that your potential buyers are as confused as you. I bet they haven't even applied for a mortgage. From my limited knowledge I have not heard of lenders turning down applications for loans for flats with 75 years unexpired.

[Corinne Tuplin]

Dear Jim,

As long as you have owned the property for two years, you can compel your freeholder to extend the lease by a further ninety years in addition to your remaining term. Using the statutory process, the Ground Rent you pay is also reduced to 'a peppercorn' (i.e. one pence a year).

If you would like further information on statutory lease extension, including a Lease Extension Valuation Report, please visit http://www.proleagle.com. Valuation Reports are £60.00 (inc. VAT).

I hope this helps.

CORINNE TUPLIN
DIRECTOR
PRO-LEAGLE
www.proleagle.com

[Tax Accountant]

can anyone help. i wrote to my freeholders to get a cost on extending my lease 9 weeks ago .after various phone calls/e-mails still no reply.the flat was built in 1982 with a 99yr lease, it has 75 yrs left. how much would it be to extend the lease and how can it be done.i've looked on this site and saw marriage value??? if the freeholders do finaly come back with a figure is it set at that price.i'm in a bit of a rush as the property is on the market and i've had at least 6 viewings but all of them are concered with only 75yrs on the lease.help..:confused:

I would say it is not surprising that potential purchasers are concerned with only 75 years of the lease term unexpired.

The cost of lease extension is determined by the leasehold valuation tribunal if the figure is not agreed between the two parties.

My freeholder did not reply to any of letters and even letters from my solicitors. Eventually, I wrote a formal letter to the freeholder at its registered address stating that in the absence of any reply, I will apply to the valuation tribunal. The freeholder replied stating that he would extend the lease from 82 years unexpired to 125 years unexpired, ie extend by only 43 years for a sum of £7,250. I posted my concerns in this forum, consulted professionals and offered to pay £2,000 to increase the lease by 90 years.

Finally I commissioned a formal valuation at a cost of £200+VAT and ended up buying a 90 years extension to my lease at a cost of £1,500 to include all costs of the freeholder. I think this was a good outcome and I am pleased that I extended the lease before it had less than 80 years unexpired.

In your case, your purchase value will need to take account of the marriage value. However, as you are not too far less than 80 years unexpired, I guess that the marriage value will not add too much to the price.

Finally, the cost of lease extension is based on the ground rents, number of years unexpired and the value of the flat at present.

I would strongly urge you to obtain a professional valuation of the cost of lease extension. I would recommend Forbes Dean Associates in Croydon (020 8760 0893) who I used in my case.

Ramnik