Want to extend a lease agreement? Here is what you need to know.

Why should you extend your lease?

You should extend your lease agreement because once the lease becomes too short somehow the property becomes even more pricy and if you go on to ignore, the amount might accumulate beyond your limits and as a result you find yourself into a leasehold scandal and that can be quite frustrating.

When the lease comes below 80 years it becomes more expensive and difficult to extend, that’s why it is advisable to extend your lease before it drops past this point. If you delay and it drops you will have to pay out 50% of the ‘marriage fee’ which means the value you will benefit from when you extend the lease.

What is the cost of extending a lease?

Extending your lease will definitely come with some cost which actually you should be prepared to incur, there are few things that are put in consideration to help determine the preferred cost, and these are;

  • The remaining length of the lease, if the lease is close to 80 years it gets more expensive
  • The value of the property and current ground rent
  • The legal cost, there is definitely a legal cost that is implicated on the cost of extending the lease
Who is allowed to extend a lease?

Extending a lease isn’t that automatic as one may think, you have to meet certain requirements as a leaseholder. This includes

  • You must have owned the property for at least more than two years
  • You cannot use the property for business purposes, for you to qualify to extend the lease you must not be intending to use it for business purpose.
  • The landlord should not be a charitable housing trust for you to qualify to extend the lease.

All these things must be considered if you want to successfully extend your lease, if you don’t meet these requirements you will fail which might see you fall into a leasehold scandal without knowledge.