At Blackstone Solicitors, we understand the importance of stability and long-term planning, especially when it comes to property. For tenants seeking to extend their lease term, a deed of variation offers a flexible and efficient solution. In this article, Deed Of Variation To Extend Lease Term, we take a look at the process and mechanism involved.
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For a free initial discussion with a member of our New Enquiries Team, get in touch with us today. We are experienced in dealing with all the legal aspects of deeds of variation, and once instructed, we will review your situation and discuss the options open to you in a clear and approachable manner. Early expert legal assistance can help ensure you are on the best possible footing from the start and also avoid the stress of dealing with these issues on your own. Simply call us on 0345 901 0445 or click here to make a free enquiry and a member of the team will get back to you.
What is a Deed of Variation?
A deed of variation is a legal document used to formally modify an existing lease agreement. It allows landlords and tenants to mutually agree upon changes to the original terms without having to go through the process of terminating the old lease and entering into a completely new one.
In the context of lease extensions, a deed of variation can be used to extend the original lease term for a set period. This provides tenants with the security of knowing they can occupy the property for a longer duration.
Deed of Variation vs. Statutory Lease Extension
It’s important to distinguish between using a deed of variation and the statutory lease extension route. The statutory process, governed by the Leasehold Reform Housing and Urban Development Act 1993, applies specifically to qualifying residential leaseholds. It allows eligible leaseholders to purchase an extension of their lease term, typically for 90 years, at a price determined by a formula.
A deed of variation, on the other hand, offers more flexibility. It can be used for both residential and commercial leases, and the extension term can be negotiated between the landlord and tenant. Additionally, the process is often quicker and less formal than the statutory route.
Benefits of Using a Deed of Variation for Lease Extension
There are several advantages to utilizing a deed of variation for extending your lease term:
- Flexibility: The terms of the extension, including the length of the additional term and any adjustments to rent or other lease provisions, can be negotiated to suit the needs of both parties.
- Cost-Effectiveness: Compared to the statutory extension route, a deed of variation can be a more cost-effective option, particularly for shorter extensions. There are typically lower legal fees involved, and depending on the negotiation, rent increases might be more manageable.
- Speed: The deed of variation process is generally quicker than the statutory route, which can involve lengthy procedures and valuations.
- Maintaining Good Landlord-Tenant Relations: A negotiated agreement through a deed of variation fosters a more collaborative relationship between the landlord and tenant.
Process of Extending a Lease Through Deed of Variation
The process of extending a lease term using a deed of variation typically involves the following steps:
- Initial Discussions: The tenant initiates the process by contacting the landlord and expressing their interest in extending the lease. Both parties discuss the desired extension term and any other potential changes to the lease agreement.
- Negotiation and Agreement: Open communication and negotiation are crucial to reach mutually agreeable terms for the extension and any adjustments to rent or other provisions.
- Solicitor Involvement: Once an agreement is reached, a solicitor is typically engaged to draft the deed of variation. The deed will clearly outline the agreed-upon extension term and any other modifications to the original lease.
- Review and Approval: Both the landlord and tenant, along with their respective solicitors, review the draft deed thoroughly to ensure all agreed-upon terms are accurately reflected.
- Execution of the Deed: Once all parties are satisfied and have signed the deed of variation, it becomes a legally binding document, formalizing the lease extension.
Key Considerations for Lease Extension via Deed of Variation
While a deed of variation offers a streamlined approach to lease extension, there are some key factors to consider:
- Landlord’s Willingness: The success of the process hinges on the landlord’s receptiveness to extending the lease. Understanding their motivations and negotiating a win-win outcome is crucial.
- Valuation for Rent Review: In some cases, the deed of variation may trigger a rent review based on the extended lease term. Consulting a property valuation expert can be beneficial to ensure a fair rent adjustment.
- Legal Expertise: Engaging a solicitor experienced in property law is highly recommended. They can guide you through the negotiation process, ensure the deed of variation is drafted accurately, and protect your interests.
Blackstone Solicitors: Your Partner in Lease Extension
At Blackstone Solicitors, our team of dedicated property law specialists has a proven track record of assisting tenants in achieving successful lease extensions through deeds of variation. We understand the nuances of negotiation and will work tirelessly to secure the best possible terms for you.
We will provide clear guidance throughout the process, from initial discussions with the landlord to drafting and finalizing the deed of variation. Our focus is on achieving a smooth and efficient experience that meets your specific needs.
How we can help
We have a proven track record of helping clients deal with deeds of variation. We will guide you through the process and ensure all checks are carried out swiftly and efficiently and we firmly believe that with the right solicitors by your side, the entire process will seem more manageable and far less daunting.
How to Contact Our Commercial Property Solicitors
It is important for you to be well informed about the issues and possible implications of dealing with deeds of variation. However, expert legal support is crucial in terms of ensuring a positive outcome to your case.
To speak to our Commercial Property solicitors today, simply call us on 0345 901 0445, or click here to make a free enquiry. We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.
Disclaimer: This article provides general information only and does not constitute legal advice on any individual circumstances.
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