Estate agents have just been given the go-ahead to market my basement flat in Cheslyn Hay.Conveyancing is yet to be initiated but I have just had a half-yearly maintenance charge invoice – Do I pay up?

Your conveyancing lawyer is likely to suggest that you should pay 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 unless 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. Having a clear account will assist your cause and will leave you no worse off financially.

I am tempted by the attractive purchase price for a two flats in Cheslyn Hay which have approximately forty five years remaining on the leases. Do I need to be concerned?

There is no doubt about it. A leasehold flat in Cheslyn Hay is a deteriorating asset as a result of the reducing lease term. The closer the lease gets to zero years unexpired, the more it reduces the salability of the premises. For most purchasers and banks, leases with under eighty years become less and less attractive. On a more positive note, leaseholders can extend their leases by serving a Section 42 Notice. One stipulation is that they must have owned the property 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 Cheslyn Hay 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 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 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.

I am employed by a busy estate agent office in Cheslyn Hay where we see a number of flat sales put at risk due to leases having less than 80 years remaining. I have received inconsistent advice from local Cheslyn Hay conveyancing solicitors. Could you confirm whether the seller of a flat can initiate the lease extension process for the purchaser on completion of the sale?

As long as the seller has been the owner for at least 2 years it is possible, to serve a Section 42 notice to commence the lease extension process and assign the benefit of the notice to the purchaser. The benefit of this is that the buyer can avoid having to sit tight for 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 disposal of the property.

Alternatively, it may be possible 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 buyer.

What advice can you give us when it comes to finding a Cheslyn Hay conveyancing practice to carry out our lease extension conveyancing?

When appointing a conveyancer for your lease extension (regardless if they are a Cheslyn Hay conveyancing firm) it is most important that they be familiar with the legislation and specialises in this area of conveyancing. We recommend that you make enquires with two or three firms including non Cheslyn Hay conveyancing practices before you instructing a firm. If the firm is ALEP accredited then so much the better. Some following of questions could be useful:

• How many lease extensions have they completed in Cheslyn Hay in the last year?

What makes a Cheslyn Hay lease problematic?

There is nothing unique about leasehold conveyancing in Cheslyn Hay. All leases are unique and drafting errors can result in certain provisions are wrong. For example, if your lease is missing any of the following, it could be defective:

• A provision to repair to or maintain elements of the building
• Insurance obligations
• Clauses dealing with recovering service charges for expenditure on the building or common parts.
• Maintenance charge proportions which don’t add up to the correct percentage

You may encounter difficulties when selling your property if you have a defective lease as they can affect a potential buyer’s ability to obtain a mortgage. Birmingham Midshires, The Royal Bank of Scotland, and Alliance & Leicester all have express requirements when it comes to what is expected in a lease. Where a lender has been advised by their lawyers that the lease does not cover certain provisions they may refuse to grant the mortgage, obliging the purchaser to withdraw.

Leasehold Conveyancing in Cheslyn Hay - A selection of Questions you should ask before Purchasing

You will want to discover as much as you can about the managing agents as they will either make your life much easier or uncomfortable. Being a leasehold owner you are often in the clutches of the managing agents both financially and when it comes to practical matters such as the upkeep of the common parts. Enquire of other tenants what they think of them. In conclusion, be sure you understand the dates that the maintenance fees are due to the appropriate party and specifically how they are spending that money. It is important to be aware if window replacement or some other significant cost is due in the near future that will be shared amongst the tenants and could well materially impact the level of the maintenance costs or necessitate a one off payment. The prefered form of lease structure is a share of the freehold. In this scenario the leaseholders have being in charge if their destiny and even though a managing agent is often retained if it is larger than a house conversion, the managing agent is directed by the tenants.

Other Topics

Lease Extensions in Cheslyn Hay