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Frequently asked questions relating to Bingham leasehold conveyancing

I have just started marketing my ground floor apartment in Bingham.Conveyancing solicitors are to be appointed soon but I have just received a yearly maintenance charge demand – should I leave it to the buyer to sort out?

It best that you clear the invoice as normal because all ground rent and service charges will be apportioned on completion, so you will be reimbursed by the buyer for the period running from after the completion date to the next payment date. Most management companies will not acknowledge the buyer until the service charges have been paid and are up to date so it is important for both buyer and seller for the seller to show that they are up to date. This will smooth the conveyancing process.

I am tempted by the attractive purchase price for a couple of apartments in Bingham both have about 50 years remaining on the leases. Should I regard a short lease as a deal breaker?

There is no doubt about it. A leasehold apartment in Bingham is a wasting asset as a result of the shortening lease. The nearer the lease gets to its expiry date, the more it reduces the value of the property. The majority of buyers and banks, leases with under eighty years become less and less attractive. On a more upbeat note, leaseholders can extend their leases by serving a Section 42 Notice. One stipulation is that they must have owned the premises for two years (unlike a Section 13 notice for purchasing the freehold, when leaseholders can participate from day one of ownership). When successful, they will have the right to an extension of 90 years to the current term and ground rent is effectively reduced to zero. Before moving forward with a purchase of a residence with a short lease term remaining you should talk to a solicitor specialising in lease extensions and leasehold enfranchisement. We are are happy to put you in touch with Bingham conveyancing experts who will explain the options available to you during an initial telephone conversation free of charge. More often than not it is possible to negotiate informally with the freeholder to extend the lease They may agree to a smaller lump sum and an increase in the ground rent, but to shorter extension terms in return. You need to ensure that the agreed terms represent good long-term value compared with the standard benefits of the Section 42 Notice and that onerous clauses are not inserted into any redrafting of the lease.

I've recently bought a leasehold house in Bingham. Do I have any liability for service charges for periods before my ownership?

Where the service charge has already been demanded from the previous owner and they have not paid you would not usually be personally liable for the arrears. However, your landlord may still be able to take action to forfeit the lease. It is an essential part of leasehold conveyancing for your conveyancer to be sure to have an up to date clear service charge receipt before completion of your purchase. If you have a mortgage this is likely to be a requirement of your lender.

If you purchase part way through an accounting year you may be liable for charges not yet demanded even if they relate to a period prior to your purchase. In such circumstances your conveyancer would normally arrange for the seller to set aside some money to cover their part of the period (usually called a service charge retention).

What advice can you give us when it comes to choosing a Bingham conveyancing practice to carry out our lease extension conveyancing?

When appointing a property lawyer for your lease extension (regardless if they are a Bingham conveyancing practice) it is most important that they be familiar with the legislation and specialises in this area of work. We recommend that you talk with several firms including non Bingham conveyancing practices prior to instructing a firm. Where the conveyancing practice is ALEP accredited then so much the better. Some following of questions might be useful:

  • How experienced is the firm with lease extension legislation?
  • How many lease extensions have they carried out in Bingham in the last twenty four months?

    • Can you provide any advice for leasehold conveyancing in Bingham from the perspective of saving time on the sale process?

    • A significant proportion of the delay in leasehold conveyancing in Bingham can be bypassed where you get in touch lawyers the minute your agents start advertising the property and ask them to collate the leasehold documentation which will be required by the buyers lawyers.
    • Many landlords or managing agents in Bingham levy fees for providing management packs for a leasehold premises. You or your lawyers should enquire as to the actual amount of the charges. The management information sought as soon as you have a buyer, thus reducing delays. The typical amount of time it takes to receive management information is three weeks. It is the most frequent cause of frustration in leasehold conveyancing in Bingham.
  • Some Bingham leases require Landlord’s consent to the sale and approval of the buyers. If this is the case, it would be prudent to notify your estate agents to make sure that the purchasers obtain bank and professional references. The bank reference will need to confirm that the buyers are financially capable of paying the yearly service charge and the actual amount of the service charge should be quoted in the bank’s letter. You will therefore need to provide your estate agents with the service charge figures so that they can pass this information on to the purchasers or their lawyers.
  • If there is a history of any disputes with your landlord or managing agents it is very important that these are settled prior to the flat being put on the market. The buyers and their solicitors will be warry about purchasing a flat where there is an ongoing dispute. You will have to accept that you will have to discharge any arrears of service charge or settle the dispute prior to completion of the sale. It is therefore preferable to have any dispute settled prior to the contract papers being issued to the buyers’ solicitors. You are still duty bound to disclose particulars of the dispute to the purchasers, but it is clearly preferable to present the dispute as historic as opposed to ongoing.
  • If you hold a share in a the freehold, you should make sure that you have the original share document. Obtaining a duplicate share certificate can be a lengthy process and slows down many a Bingham conveyancing deal. If a new share is needed, do contact the company officers or managing agents (where applicable) for this sooner rather than later.

    • I own a garden flat in Bingham, conveyancing formalities finalised in 2010. How much will my lease extension cost? Corresponding properties in Bingham with over 90 years remaining are worth £173,000. The ground rent is £55 invoiced every year. The lease ends on 21st October 2090

    With only 65 years left to run the likely cost is going to range between £13,300 and £15,400 as well as plus your own and the landlord's "reasonable" professional fees.

    The suggested premium range that we have given is a general guide to costs for extending a lease, but we are not able to provide the actual costs in the absence of comprehensive investigations. You should not use this information in a Notice of Claim or as an informal offer. There are no doubt additional issues that need to be taken into account and you obviously want to be as accurate as possible in your negotiations. Please do not take any other action placing reliance on this information without first getting professional advice.

    Other Topics

    Lease Extensions in Bingham