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Case Study: Saving Over £108,000 On A Lease Extension

If you are considering a lease extension, this information alone may save you thousands of pounds...

Recently Linda came to us wanting to extend her lease, which now had 81 years remaining. As is often the case, she had contacted the freeholder via the management company to ask for a lease extension. This is what the freeholder offered:

   

The amount asked was £4,650 to extend the lease by only 18 more years. In addition the ground rent was to increase from £100 to £175 per year, and then double every 25 years!  They used the phrase "to bring in line the ground rent as in modern leases". Clever. I hesitate to guess on the number of people who would just pay the amount asked, without question.

Fortunately Linda came to us first - we believe that the 'ground rent as in modern leases' should actually be zero!

With a formal claim under the Leasehold Reform Housing and Urban Development Act 1993 (as amended) and subsequent negotiation, we were able to secure a 171 year lease, at zero ground rent for only £3,900.

The savings that Linda made are almost unbelievable - with the inflated premium, and grossly unfair ground rent over the entire term, Linda has saved over £108,000!!

Here are the details:

Total amount payable under terms offered

 

 

 

Premium payable

 

 

 

£4,650

Ground rent

 

 

Increase Only

 

£175

(2009-2012)

for 3 years

£225

 

£350

(2013-2037)

for 25 years

£6,250

 

£700

(2038-2062)

for 25 years

£15,000

 

£1,400

(2063-2087)

for 25 years

£32,500

 

£2,800

(2088-2108)

for 21 years

£54,000

 

Total Grount Rent

 

 

 

£107,975

 

 

 

 

Total Payable With Freeholder Offer

 

 

£112,625

 

 

 

 

Amount Agreed by Leasehold Doctors

 

 

£3,900

       
Total Savings By Using Leasehold Doctors     £108,725

 

Our advice?

Whether you use our service or not, make sure you are not getting a very one-sided agreement. You have rights. Use them.

YOUR GUARANTEE:

If for any reason your application is refused by a mistake on our part, we will fully refund our fees.

OUR CHARGES AND SERVICES - FIXED FEES, NO SURPRISES
Probably the biggest concern of new clients is that they will have much legal and valuation work performed and then find that it is not possible to extend their lease, or that the purchase cost is excessive for them at present to extend lease.

We solve this concern simply - For no charge, we will complete the necessary checks for qualification and entitlement - and also perform an estimated valuation of the premium that will be payable for the lease extension. To be able to perform the valuation, we will just ask you for some basic facts about your flat. The valuation is based on the discounted ground rent over the existing lease period, the reversion value of the flat and the marriage value of the flat after extension. After the checks and valuation, you will have a good idea of the purchase price (premium) payable to the landlord. (Note this is an approximate valuation, we would recommend the use of a formal valuation to be in used the Notice of Claim and subsequent landlord negotiations. We can also arrange for a formal independent valuation by an experienced fully qualified valuer who specialises in dealing with Leasehold valuations.

At this stage, if you wish to proceed, we will prepare and serve the 'Notice of Claim' for you, strictly in accordance with your instructions regarding the amount proposed by way of premium and any amendments that may be required. This will be served on the competent landlord (an intermediate landlord may not have the right to extend your lease the full 90 years) and copied to any additional landlords. At this point the Landlord is under strict requirements to respond within a fixed period.

Our fees for the preparation and service of the Initial Notice Of Claim, and follow-up negotiations are £395 + VAT. We do not charge an hourly rate, and all fees are clearly specified in writing. After receiving the Notice of Claim, the Landlord may disagree (strangely they always disagree) with the premium offered. Upon  your instructions, we will negotiate on your behalf with the Landlord.

If negotiations fail, we can make an application to the Leasehold Valuation Tribunal (LVT) on your behalf (who will decide the premium payable), although at that point further fees would be payable. We are unable to guarantee any application will be successful or the amount of the eventual premium that may be determined by the Tribunal. We can arrange for a chartered surveyor to attend the LVT on your behalf for leasehold extension.

You will be liable for the 'reasonable' legal and costs of the Landlord relative to the Notice of Claim and the preparation / completion of the new lease (but not Landlord costs which are incurred in connection with any LVT hearing). Please ensure you carefully read our Terms and Conditions covering this website and our services.

COMMUNICATIONS
Throughout each stage of the process, we will keep you fully informed. Both by providing detailed descriptions of the process, but also on the progress of each stage. For your convenience, we will provide electronic copies of all documentation.

WHAT NEXT?
Call us today on
020 8626 4490 or click here for no-obligation advice on how to increase the value of your flat by extending your lease.

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