The dangers of an informal lease extension - YouTube

when instrument Davies on this list to open and can be ship

and I'm hits talk to you about informally extensions

and the dangers that face rover

put simply an informal lease extension is one that is privately agreed with you

freeholder

outside the statutory provisions for

a brief summary of the description between the two

lease extensions that he may get are as follows: under statutory

lease extension then you get an additional 90 years on top of you

unexpired

10 and to cram into content with peppercorn which is nothing

for the remainder of the least M the legislation also provides

if you lease is potentially defective all requires modification to bring in on

with modern standards

so for example with the insurance provision then this can be modified

in the lease extension and out within 1 which sensible

under private regime there are no

such restraints a freeholder Khanal ask for anything they want to

and so they may seek to include terms which may be onerous to you

all my pic you in the most advantageous position and you currently in

row for

it may initially appear simpler and cheaper

tip terrain and informally 6 tension by green with a freeholder

however that there are some significant risks and pitfalls doing this

the freeholder may withdraw or anytime and it is a potentially risky strategy

if you release

is running down to the ATM mark row for

you download your free holder can we stroll from the process have been

informally 6 tension

at anytime there is nothing to find them to continue with the process

and it is only once the document is completed and say signed by yourself

and a freeholder that lease extension actually takes place

at any time before this you freehold aka walkway

and you have to come back against them for doing so i for

there are some risks in pursuing an informal East extension

if you lease is approaching the eighty-year unexpired mark

once least drops below eighty years than the premium paid

booty freeholder is likely to rise sharply in continue to rise the shorter

the lease becomes

at the time release is over 80 years unexpired you do not have this

additional

element to pay by way of marriage value to you freeholder

some unscrupulous freeholders will agree to an informal lease extension

if you lease is approaching the ATM ok they may drag their heels

be very slow in responding T says the police then drops down below the eighty

a mark

at which point they may withdraw your consent to an informal East extension

once this occurs you will then be left with the least

is below eighty years and so will have to pay that additional premium or

payment

to the freeholder row for

a potential pitfall under the informal or private lease extension which is the

cannot fix the valuation date and so if the freeholder decides to take six

months in negotiations and walkway

you are then left with calculating the lease extension

at today states rather than when you started negotiations

by contrast 7 notice under the statutory regime

fixes the valuation date and insures your rights to lease extension

regardless of how long a freeholder drug that negotiations

row for

when negotiating an informal or private lease extension there are no

really limits on the Thames that can be agreed between the parties

as long as the terms are obviously legal an acceptable by both parties in the

tent will feature in the new lace

row the outset it may appear that

informally 6 tension is cheaper and for some leaseholders it

often does work out b-side with an informal lease extension you will have

your own legal costs

but you will also be responsible for the freeholders legal and valuation costs

as well as the final premium that you end up paying the danger is that if the

freehold two walks away at any time during the transaction

you are obliged to pay his costs from the outset

and so you will have to pay not only one legal costs but the freeholders

and if you have no lease extension at the end of that you will still need to

follow the statutory regime

in order to obtain a lease extension affectively Inc having wasted

GPK to costs there is nothing to stop you making an informal approach to a

freeholder it's not going to prejudice your position in the long run

or prevent me from 7 the statutory notice should negotiations with your

freeholder

fail to materialize in a lease extension it's important to appreciate that any

informal approach does not guarantee lease extension and say a freeholder can

walk away at any time

however that said many private negotiations do completes the result

and Felice extensions the pitfall in the danger

is that you freeholder may stall I'm a walkway from the process

and if this is say six months down the line you lease is that little bit

shorter

and so this may affect the premium that you end up paying to a freeholder

ultimately by following the statutory rate