As we've mentioned, 80 years is the key figure; once your remaining lease gets close to this, or falls below, there are some important implications that you need to be aware of:
• You will be liable to pay an additional "Marriage Fee". This is a percentage sum which the owner of the freehold is entitled to if you extend your lease when the term falls below 80 years.
• Some mortgage providers will not lend money on a property if the term remaining is less than 80 years.
• Buyers may consider other properties with longer leases – as they’re seen as a safer option.
• The value of your property may fall.
Don’t worry, we can still help. The process is slightly more complicated and will involve paying a Marriage Fee, but it can usually be sorted out with minimum fuss.
To extend your lease, you will pay a "premium" to the freehold owner. Ocean property lawyers will negotiate on your behalf, to ensure you don't pay more than you should.
Usually, an additional term of 90 years will be added to the unexpired term of the lease, which means that if your lease currently has, say, 83 years remaining, it will then increase to 173 years.
We'll also set up a "peppercorn" ground rent - which will be of nominal value, so in effect, you will no longer pay any ground rent.
It's important to get this right, because some freehold owners may offer a low premium to extend the lease, while trying to increase the ground rent - which could prove expensive for you in the long term.
It may also be an option for you to buy a share of the freehold your property is leased on, and we can advise you on this process, too.
If you are considering extending your lease, give us a call. Our friendly and experienced legal team will guide you through the process step by step, ensuring that all the potential pitfalls are avoided.
• Confirm you are eligible to extend your lease
• Check if your landlord will consider extending the lease, or selling the freehold
• Advise you on the process
• Negotiate the terms on your behalf
• Guide you through each step of the process