Bethnal Green leasehold conveyancing: Q and A’s
My wife and I purchased a leasehold house in Bethnal Green. Conveyancing and Britannia mortgage organised. A letter has just been received from someone claiming to own the reversionary interest in the property. Attached was a demand for arrears of ground rent dating back to 1996. The conveyancing practitioner in Bethnal Green who previously acted has now retired.Any advice?
First make enquiries of HMLR to be sure that the individual purporting to own the freehold is in fact the registered owner of the freehold reversion. It is not necessary to incur the fees of a Bethnal Green conveyancing practitioner to do this as you can do this on the Land Registry website for a few pound. You should note that regardless, even if this is the legitimate landlord, under the Limitation Act 1980 the limitation period for recovery of ground rent is six years.
I am attracted to a couple of maisonettes in Bethnal Green which have in the region of fifty years left on the leases. should I be concerned?
There are no two ways about it. A leasehold flat in Bethnal Green is a wasting asset as a result of the reducing lease term. The nearer the lease gets to its expiry date, the more it adversely affects the marketability of the premises. The majority of buyers and lenders, leases with under 75 years become less and less marketable. 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 premises 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 Bethnal Green conveyancing experts who will explain the options available to you during an initial telephone conversation free of charge. More often than not it is possible to negotiate informally with the freeholder to extend 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 the agreed 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 Bethnal Green. Am I liable to pay service charges for periods before completion of my purchase?
In a situation 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. It is an essential part 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).
If all goes to plan we aim to complete our sale of a £475000 maisonette in Bethnal Green next Wednesday . The landlords agents has quoted £420 for Certificate of Compliance, insurance certificate and 3 years statements of service charge. Is it legal for a freeholder to charge an administration fee for a leasehold conveyance in Bethnal Green?
Bethnal Green conveyancing on leasehold flats typically involves administration charges raised by freeholders :
- Answering conveyancing due diligence questions
- Where consent is required before sale in Bethnal Green
- Copies of the building insurance and schedule
- Deeds of covenant upon sale
- Registering of the assignment of the change of lessee after a sale
Following years of correspondence we are unable to agree with our landlord on how much the lease extension should cost for our flat in Bethnal Green. Can we issue an application to the Residential Property Tribunal Service?
Most certainly. We can put you in touch with a Bethnal Green conveyancing firm who can help.
An example of a Lease Extension matter before the tribunal for a Bethnal Green residence is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case was in relation to 2 flats. The the unexpired term as at the valuation date was 72.39 years.
Are there frequently found defects that you witness in leases for Bethnal Green properties?
Leasehold conveyancing in Bethnal Green is not unique. Most leases is drafted differently and legal mistakes in the legal wording can sometimes mean that certain sections are not included. The following missing provisions could result in a defective lease:
- Repairing obligations to or maintain parts of the building
- A duty to insure the building
- A provision for the recovery of money spent for the benefit of another party.
- Maintenance charge proportions which don’t add up to the correct percentage
You may have difficulties when selling your property if you have a defective lease as they can affect a potential buyer’s ability to obtain a mortgage. Santander, Barnsley Building Society, and Alliance & Leicester all have very detailed conveyancing instructions when it comes to what is expected in a lease. If a mortgage lender believes that the lease is defective they may refuse to grant the mortgage, obliging the buyer to pull out.