What is a lease extension?
A leasehold is the right to occupy a piece of land for a certain period of time. When the lease expires the property reverts to the freeholder. A lease extension is when you add years to your lease on the property.
What are the benefits of extending the lease?
You can add up to 90 extra years to your lease, increase the value of your flat and avoid paying ground rent again. If you extend before the lease runs below 80 years, you limit the cost considerably.
What are the types of lease extension?
Provided you qualify for a statutory lease extension, also known as a formal lease extension, you will be legally entitled to compel your landlord to grant you a lease extension on fixed terms i.e. 90 extra years on your lease and no ground rent. This is guaranteed because you are protected by statute.
A non-statutory lease extension, also known as an informal or voluntary lease extension, is a private agreement between the leaseholder and freeholder.
This might be quicker, cheaper and easier than the formal process, but you are not protected by statute and the freeholder may impose harsh terms.
