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Top Five Questions relating to Cowley leasehold conveyancing

My wife and I purchased a leasehold house in Cowley. Conveyancing and Accord Mortgages Ltd mortgage organised. A letter has just been received from someone saying they have taken over the reversionary interest in the property. It included a demand for arrears of ground rent dating back to 1994. The conveyancing solicitor in Cowley who previously acted has now retired.What should I do?

The first thing you should do is make enquiries of HMLR to be sure that the individual claiming to own the freehold is in fact the new freeholder. There is no need to incur the fees of a Cowley conveyancing lawyer to do this as you can do this on the Land Registry website for £3. You should note that in any event, even if this is the rightful freeholder, under the Limitation Act 1980 no more than 6 years of rent can be collected.

Last month I purchased a leasehold flat in Cowley. 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. A critical element 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 long established estate agent office in Cowley where we have witnessed a few leasehold sales jeopardised as a result of leases having less than 80 years remaining. I have been given conflicting advice from local Cowley conveyancing firms. Could you shed some light as to whether the seller of a flat can commence the lease extension process for the buyer?

Provided that the seller has owned the lease 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 need not have 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 simultaneously with completion of the disposal of the property.

An alternative approach is 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 purchaser.

Do you have any top tips for leasehold conveyancing in Cowley from the point of view of expediting the sale process?

  • Much of the frustration in leasehold conveyancing in Cowley can be reduced if you appoint lawyers the minute you market your property and request that they start to put together the leasehold information needed by the buyers solicitors.
  • The majority freeholders or managing agents in Cowley charge for supplying management packs for a leasehold property. You or your lawyers should find out the actual amount of the charges. The management information can be applied for on or before finding a buyer, thus reducing delays. The average time it takes to obtain the necessary information is three weeks. It is the most usual reason for delay in leasehold conveyancing in Cowley.
  • A minority of Cowley leases require Landlord’s consent to the sale and approval of the buyers. If this is the case, you should notify your estate agents to make sure that the purchasers put in hand financial (bank) and professional references. The 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 actual amount of the service charge so that they can pass this information on to the buyers or their solicitors.
  • If you have had any disputes with your freeholder or managing agents it is very important that these are settled before the property is put on the market. The buyers and their solicitors will be reluctant to purchase a property where there is a current dispute. You will have to accept that you will have to pay any arrears of service charge or resolve the dispute prior to completion of the sale. It is therefore preferable to have any dispute settled ahead of the contract papers being issued to the buyers’ solicitors. You are still duty bound to disclose particulars of the dispute to the buyers, but it is better to reveal the dispute as over as opposed to unsettled.
  • If you are supposed to have a share in the Management Company, you should make sure that you are holding the original share certificate. Arranging a replacement share certificate can be a time consuming process and slows down many a Cowley conveyancing transaction. Where a duplicate share certificate is necessary, do contact the company director and secretary or managing agents (where applicable) for this as soon as possible.

    • I have attempted and failed to negotiate with my landlord to extend my lease without success. Can the Leasehold Valuation Tribunal adjudicate on such issues? Can you recommend a Cowley conveyancing firm to assist?

    Where there is a missing freeholder or if there is dispute about what the lease extension should cost, under the Leasehold Reform, Housing and Urban Development Act 1993 it is possible to make an application to the Leasehold Valuation Tribunal to decide the price payable.

    An example of a Freehold Enfranchisement matter before the tribunal for a Cowley residence is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case affected 2 flats. The remaining number of years on the lease was 69 years.

    What makes a Cowley lease defective?

    There is nothing unique about leasehold conveyancing in Cowley. Most leases are unique and drafting errors can sometimes mean that certain sections are erroneous. The following missing provisions could result in a defective lease:

    • A provision to repair to or maintain parts of the building
    • 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

    A defective lease will likely cause issues when trying to sell a property as they can affect a potential buyer’s ability to obtain a mortgage. National Westminster Bank, Barnsley Building Society, and Platform Home Loans Ltd 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 is problematic they may refuse to grant the mortgage, forcing the purchaser to withdraw.

    Other Topics

    Lease Extensions in Cowley