Farnham Common leasehold conveyancing: Q and A’s
I’m about to sell my 2 bed apartment in Farnham Common.Conveyancing is yet to be initiated but I have just had a quarterly service charge invoice – should I leave it to the buyer to sort out?
Your conveyancing lawyer is likely to suggest that you should discharge the service charge 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 managing agents 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.
Last month I purchased a leasehold house in Farnham Common. Am I liable to pay service charges relating to a period prior to 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. Strange as it may seem, 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 work for a reputable estate agent office in Farnham Common where we have witnessed a few leasehold sales derailed as a result of leases having less than 80 years remaining. I have received contradictory information from local Farnham Common conveyancing firms. Could you shed some light as to whether the vendor of a flat can commence 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 sit tight for 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment has to be done prior to, or simultaneously with completion of the sale.
An alternative approach is to agree the lease extension with the freeholder 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 your top tips when it comes to choosing a Farnham Common conveyancing practice to deal with our lease extension?
If you are instructing a solicitor for lease extension works (regardless if they are a Farnham Common conveyancing practice) it is imperative that they be familiar with the legislation and specialises in this area of work. We suggested that you talk with several firms including non Farnham Common conveyancing practices prior to instructing a firm. If the firm is ALEP accredited then so much the better. Some following of questions could be helpful:
- How many lease extensions has the firm carried out in Farnham Common in the last twenty four months?
Our conveyancer has advised that he intends to complete and exchange simultaneously on the disposal of our £375000 garden flat in Farnham Common next week. The management company has quoted £420 for Landlord’s certificate, building insurance schedule and previous years service charge statements. Is it legal for a freeholder to charge exorbitant fees for a leasehold conveyance in Farnham Common?
Farnham Common conveyancing on leasehold maisonettes more often than not necessitates the buyer’s solicitor submitting questions for the landlord to answer. Although the landlord is under no legal obligation to answer these enquiries most will be willing to assist. They may levy a reasonable administration fee for responding to enquiries or supplying documentation. There is no upper cap for such fees. The average fee for the paperwork that you are referring to is £350, in some transactions it exceeds £800. The administration charge invoiced by the landlord must be sent together with a summary of entitlements and obligations in respect of administration fees, otherwise the charge is not strictly payable. Reality however dictates that one has no choice but to pay whatever is requested of you should you wish to sell the property.
Farnham Common Leasehold Conveyancing - Sample of Queries before buying
How many of the leaseholders are in arrears for their maintenance charge payments?
Many Farnham Common leasehold properties will be liable to pay a service bill for maintenance of the building invoiced on behalf of the freeholder. Should you purchase the flat you will have to meet this amount, normally periodically accross the year. This could be anything from several hundred pounds to thousands of pounds for blocks with lifts and large common areas. In all probability there will be a ground rent to be met annual, ordinarily this is not a significant amount, say about £25-£75 but you should to check it because occasionally it can be surprisingly expensive.
Who manages the block?