Questions and Answers: Bovey Tracey leasehold conveyancing
My wife and I may need to sub-let our Bovey Tracey basement flat temporarily due to a career opportunity. We instructed a Bovey Tracey conveyancing firm in 2003 but they have since shut and we did not think at the time seek any guidance as to whether the lease permits subletting. How do we find out?
Your lease dictates relations between the landlord and you the leaseholder; in particular, it will indicate if subletting is not allowed, or permitted but only subject to certain caveats. The rule is that if the lease contains no expres ban or restriction, subletting is permitted. Most leases in Bovey Tracey do not contain strict prohibition on subletting – such a provision would adversely affect the market value the property. In most cases there is simply a requirement that the owner notifies the freeholder, possibly sending a copy of the sublease.
I am tempted by the attractive purchase price for a two maisonettes in Bovey Tracey which have in the region of 50 years left on the lease term. Should I regard a short lease as a deal breaker?
There are no two ways about it. A leasehold flat in Bovey Tracey is a deteriorating asset as a result of the shortening lease. The nearer the lease gets to its expiry date, the more it reduces the marketability of the premises. The majority of buyers and lenders, leases with under eighty years become less and less marketable. 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 Bovey Tracey conveyancing experts who will explain the options available to you during an initial telephone conversation free of charge. A more straightforward and quicker method of extending would be to contact your landlord directly and sound him out on the prospect of extending the lease You may find he or she is happy to negotiate informally and willing to consider your offer straight off, without having to involve anyone else. This will save you time and money and it could help you reach a lower price on the lease. You need to ensure that any new 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.
Last month I purchased a leasehold property in Bovey Tracey. 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. A critical element of leasehold conveyancing for your conveyancer to ensure 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).
I am employed by a reputable estate agency in Bovey Tracey where we see a number of flat sales derailed as a result of leases having less than 80 years remaining. I have been given inconsistent advice from local Bovey Tracey conveyancing solicitors. Can you clarify whether the seller of a flat can initiate the lease extension formalities for the purchaser on completion of the sale?
As long as the seller has owned the lease for at least 2 years it is possible, to serve a Section 42 notice to kick-start the lease extension process and assign the benefit of the notice to the purchaser. This means that the proposed purchaser can avoid having to wait 2 years to extend their lease. Both sets of lawyers will agree to form of assignment. The assignment has to be done prior to, or at the same time as completion of the sale.
An alternative approach is to extend the lease informally by agreement with the landlord either before or after the sale. If you are informally negotiating there are no rules and so you cannot insist on the landlord agreeing to grant an extension or transferring the benefit of an agreement to the purchaser.
What are the common problems that you come across in leases for Bovey Tracey properties?
Leasehold conveyancing in Bovey Tracey is not unique. Most leases are individual and legal mistakes in the legal wording can sometimes mean that certain provisions are not included. The following missing provisions could result in a defective lease:
- A provision to repair to or maintain elements of the property
- A duty to insure the building
- A provision for the recovery of money spent for the benefit of another party.
- Service charge per centages that don't add up correctly leaving a shortfall
A defective lease can cause issues when trying to sell a property as they can affect a potential buyer’s ability to obtain a mortgage. Lloyds TSB Bank, The Royal Bank of Scotland, and Platform Home Loans Ltd all have express conveyancing instructions when it comes to what is expected in a lease. Where a lender has been advised by their lawyers that the lease is problematic they may refuse to grant the mortgage, obliging the purchaser to withdraw.
Bovey Tracey Leasehold Conveyancing - A selection of Queries before Purchasing
Are there any major works on the horizon that will add a premium to the maintenance costs?
The answer will be important as a) areas can cause problems in the block as the common areas may begin to deteriorate where maintenance remain unpaid b) if the leasehold owners have a dispute with the managing agents you will want to know about it
You will want to discover as much as you can about the managing agents as they will impact your use and enjoyment of the property. As the owner of a leasehold property you are often at the mercy of the managing agents both financially and when it comes to practical issues such as the tidiness of the common parts. Ask other people what they think of their management. Finally, investigate as to the dates that the maintenance charges are due to the relevant party and precisely how they are spending that money.