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Top Five Questions relating to Ingatestone leasehold conveyancing

I work for a busy estate agent office in Ingatestone where we see a few leasehold sales derailed due to short leases. I have received inconsistent advice from local Ingatestone conveyancing solicitors. Can you clarify whether the seller of a flat can commence the lease extension formalities 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 proposed purchaser 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 needs to be completed prior to, or simultaneously with completion of the disposal of the property.

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.

Can you offer any advice when it comes to finding a Ingatestone conveyancing practice to deal with our lease extension?

If you are instructing a property lawyer for lease extension works (regardless if they are a Ingatestone conveyancing practice) it is most important that they be familiar with the legislation and specialises in this area of work. We suggested that you make enquires with two or three firms including non Ingatestone conveyancing practices prior to instructing a firm. If the firm is ALEP accredited then that’s a bonus. Some following of questions could be helpful:

  • If the firm is not ALEP accredited then what is the reason?
  • How many lease extensions has the firm conducted in Ingatestone in the last 12 months?

  • Can you provide any advice for leasehold conveyancing in Ingatestone with the intention of expediting the sale process?

    • Much of the frustration in leasehold conveyancing in Ingatestone can be bypassed if you instruct lawyers the minute your agents start marketing the property and ask them to put together the leasehold information which will be required by the purchasers’ lawyers.
    • In the event that you altered the property did you need the Landlord’s permission? In particular have you laid down wooden flooring? Ingatestone leases often stipulate that internal structural alterations or addition of wooden flooring require a licence issued by the Landlord consenting to such alterations. If you dont have the consents to hand do not communicate with the landlord without checking with your solicitor before hand.
  • Some Ingatestone leases require Licence to Assign from the landlord. If this is the case, it would be prudent to place the estate agents on notice to make sure that the purchasers put in hand financial (bank) and professional references. Any bank reference should make it clear that the buyer is financially capable of paying the annual 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 freeholder or managing agents it is essential that these are settled prior to the flat being put on the market. The buyers and their solicitors will be warry about purchasing a property where a dispute is ongoing. 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 better to present the dispute as historic as opposed to unsettled.
  • If you are supposed to have a share in the freehold, you should ensure that you have the original share document. Organising a duplicate share certificate is often a time consuming process and slows down many a Ingatestone home move. If a reissued share certificate is required, you should approach the company officers or managing agents (where relevant) for this sooner rather than later.

  • We expect to complete the sale of our £275000 flat in Ingatestone next Monday . The management company has quoted £312 for Certificate of Compliance, insurance certificate and previous years statements of service charge. Is the landlord entitled to charge an administration fee for a leasehold conveyance in Ingatestone?

    Ingatestone conveyancing on leasehold flats usually necessitates the buyer’s lawyer submitting questions for the landlord to address. Although the landlord is under no legal obligation to answer such questions the majority will be content to do so. They may levy a reasonable administration fee for answering enquiries or supplying documentation. There is no set fee. The average costs for the paperwork that you are referring to is £350, in some cases it is above £800. The administration charge required by the landlord must be sent together with a synopsis of entitlements and obligations in respect of administration charges, otherwise the charge is technically not due. In reality one has no option but to pay whatever is demanded if you want to exchange contracts with the buyer.

    Are there common problems that you come across in leases for Ingatestone properties?

    There is nothing unique about leasehold conveyancing in Ingatestone. All leases is drafted differently and drafting errors can result in certain provisions are missing. The following missing provisions could result in a defective lease:

    • A provision to repair to or maintain elements of the premises
    • Insurance obligations
    • Clauses dealing with recovering service charges for expenditure on the building or common parts.
    • Service charge per centages that don't add up correctly leaving a shortfall

    You may have a problem when selling your property if you have a defective lease as they can affect a potential buyer’s ability to obtain a mortgage. Lloyds TSB Bank, Virgin Money, and Bank of Ireland all have very detailed requirements when it comes to what is expected in a lease. If a mortgage lender believes that the lease is problematic they may refuse to grant the mortgage, obliging the purchaser to withdraw.

    Ingatestone Leasehold Conveyancing - A selection of Questions you should consider Prior to Purchasing

      Where a Ingatestone lease has fewer than eighty years it will affect the salability of the flat. Check with your mortgage company that they are happy with remaining years on the lease. Leases with less than 80 years remaining means that you will probably require a lease extension sooner rather than later and you need to have some idea of how much this will be. Remember, in most cases you would need to own the premises for 24 months in order to be legally able to carry out a lease extension. Can you inform me if there are any major works in the near future that will likely increase the maintenance costs? Is the freehold reversion owned collectively by the leaseholders?

    Other Topics

    Lease Extensions in Ingatestone