Last month I purchased a leasehold flat in Llanbedrog. Am I liable to pay service charges for periods before completion of my purchase?

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).

I work for a busy estate agency in Llanbedrog where we have witnessed a number of flat sales put at risk as a result of short leases. I have been given inconsistent advice from local Llanbedrog conveyancing firms. Could you clarify whether the seller of a flat can start 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 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 for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment needs to be completed before, or at the same time as completion of the sale.

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 are your top tips when it comes to appointing a Llanbedrog conveyancing firm to deal with our lease extension?

When appointing a property lawyer for lease extension works (regardless if they are a Llanbedrog conveyancing firm) it is essential that they be familiar with the legislation and specialises in this area of work. We suggested that you talk with two or three firms including non Llanbedrog conveyancing practices prior to instructing a firm. If the firm is ALEP accredited then that’s a bonus. Some following of questions might be of use:

• How familiar is the practice with lease extension legislation?

If the firm is not ALEP accredited then what is the reason?

Can you provide any top tips for leasehold conveyancing in Llanbedrog with the intention of speeding up the sale process?

• A significant proportion of the frustration in leasehold conveyancing in Llanbedrog can be reduced if you instruct lawyers the minute your agents start advertising the property and request that they start to collate the leasehold information needed by the buyers representatives.
• If you have carried out any alterations to the property would they have required Landlord’s approval? Have you, for example laid down wooden flooring? Most leases in Llanbedrog state that internal structural changes or laying down wooden flooring require a licence from the Landlord consenting to such changes. Should you fail to have the paperwork in place do not communicate with the landlord without contacting your conveyancer in the first instance.

Some Llanbedrog leases require Licence to Assign from the landlord. If this is the case, you should notify your estate agents to make sure that the purchasers obtain financial (bank) and professional references. The bank reference will need to confirm that the buyers are able to meet 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 you have had conflict with your freeholder or managing agents it is essential that these are resolved prior to the flat being put on the market. The purchasers and their solicitors will be reluctant to purchase a flat where there is an ongoing dispute. You may have to bite the bullet and 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 will still have to reveal details of the dispute to the purchasers, but it is better to reveal the dispute as over as opposed to ongoing.

You believe that you know the number of years remaining on your lease but it would be advisable verify this by asking your solicitors. A purchaser's lawyer will be unlikely to recommend their client to to exchange contracts if the lease term is below 80 years. It is therefore essential at an as soon as possible that you identify whether the lease term requires a lease extension. If it does, contact your solicitors before you put your premises on the market for sale.

If all goes to plan we aim to complete the disposal of our £350000 flat in Llanbedrog next Friday . The freeholder has quoted £408 for Landlord’s certificate, building insurance schedule and 3 years statements of service charge. Is it legal for a freeholder to charge such fees for a leasehold conveyance in Llanbedrog?

Llanbedrog conveyancing on leasehold apartments normally results in administration charges raised by freeholders :

• Addressing pre-exchange questions
• Where consent is required before sale in Llanbedrog
• Supplying insurance information
• Deeds of covenant upon sale
• Registering of the assignment of the change of lessee after a sale

Your lawyer will have no control over the level of the charges for this information but the average costs for the information for Llanbedrog leasehold premises is £350. For Llanbedrog conveyancing transactions it is customary for the seller to pay for these costs. The landlord or their agents are under no legal obligation to answer such questions most will be willing to do so - albeit often at exorbitant prices where the fees bear little relation to the work involved. Unfortunately there is no law that requires fixed charges for administrative tasks. Neither is there any legal time frame by which they are required to supply answers.

Llanbedrog Leasehold Conveyancing - A selection of Queries Prior to Purchasing

Is the freehold reversion owned collectively by the leaseholders? Make sure you enquire if there are any onerous restrictions in the lease. By way of example it is very common in Llanbedrog leases that pets are not allowed in in a block in Llanbedrog. If you love the flatin Llanbedrog but your dog is not allowed to live with you then you have a very hard decision. Please inform me if there are any major works on the horizon that could increase the service fees?

Other Topics

Lease Extensions in Llanbedrog