Top Five Questions relating to Fulham leasehold conveyancing
There are only 72 years remaining on my flat in Fulham. I now want to extend my lease but my freeholder is can not be found. What are my options?
On the basis that you qualify, under the Leasehold Reform, Housing and Urban Development Act 1993 you can apply to the County Court for an order to dispense with the service of the initial notice. This will mean that your lease can be extended by the Court. However, you will be required to demonstrate that you have done all that could be expected to find the freeholder. For most situations a specialist should be useful to conduct investigations and prepare a report which can be accepted by the court as proof that the landlord can not be located. It is wise to seek advice from a conveyancer both on proving the landlord’s disappearance and the application to the County Court overseeing Fulham.
I am tempted by the attractive purchase price for a two flats in Fulham both have approximately forty five years unexpired on the lease term. Should I regard a short lease as a deal breaker?
There are no two ways about it. A leasehold flat in Fulham is a wasting asset as a result of the shortening lease. The nearer the lease gets to its expiry date, the more it reduces the salability of the property. The majority of buyers and mortgage companies, leases with less than eighty years become less and less attractive. 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 Fulham 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 any new 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 Fulham. Am I liable to pay service charges relating to a period prior to 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. 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).
Do you have any advice for leasehold conveyancing in Fulham from the perspective of expediting the sale process?
- A significant proportion of the delay in leasehold conveyancing in Fulham can be bypassed where you instruct lawyers as soon as your agents start marketing the property and request that they start to collate the leasehold information needed by the buyers solicitors.
- If you have carried out any alterations to the property would they have required Landlord’s consent? In particular have you laid down wooden flooring? Fulham leases often stipulate that internal structural changes or addition of wooden flooring require a licence from the Landlord acquiescing to such changes. Where you fail to have the paperwork to hand you should not contact the landlord without contacting your conveyancer first.
I have tried to negotiate informally with with my landlord to extend my lease without getting anywhere. Can the Leasehold Valuation Tribunal adjudicate on such matters? Can you recommend a Fulham conveyancing firm to act on my behalf?
if there is a missing freeholder or if there is disagreement about the premium for a lease extension, under the Leasehold Reform, Housing and Urban Development Act 1993 it is possible to make an application to the Leasehold Valuation Tribunal to determine the sum to be paid.
An example of a Freehold Enfranchisement decision for a Fulham premises is 66 and 66a Wardo Avenue in November 2012. The Tribunal determined that the sum of £8,048 is payable by the Applicants in respect of the price for the freehold of the property This case related to 2 flats. The remaining number of years on the lease was 93 years and 162 years.
Are there frequently found problems that you see in leases for Fulham properties?
There is nothing unique about leasehold conveyancing in Fulham. Most leases is drafted differently and drafting errors can result in certain sections are erroneous. For example, if your lease is missing any of the following, it could be defective:
- A provision to repair to or maintain elements of the property
- A duty to insure the building
- A provision for the recovery of money spent for the benefit of another party.
- Service charge per centages that don't add up correctly leaving a shortfall
You could encounter difficulties when selling your property if you have a defective lease primarily because it impacts on the ability to obtain a mortgage on the property. Yorkshire Building Society, Chelsea Building Society, and TSB 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 pull out.