Frequently asked questions relating to Millwall leasehold conveyancing
I have just appointed agents to market my basement apartment in Millwall.Conveyancing is yet to be initiated but I have just received a quarterly service charge demand – what should I do?
The sensible thing to do is discharge the service charge as normal because all ground rent and service charges will be apportioned on completion, so you will be reimbursed by the buyer for the period running from after the completion date to the next payment date. Most management companies will not acknowledge the buyer until the service charges have been paid and are up to date so it is important for both buyer and seller for the seller to show that they are up to date. This will smooth the conveyancing process.
I am hoping to put an offer on a small detached house that appears to meet my requirements, at a reasonable figure which is making it more attractive. I have since discovered that the title is leasehold rather than freehold. I would have thought that there are particular concerns buying a house with a leasehold title in Millwall. Conveyancing advisers have are about to be instructed. Will my lawyers set out the implications of buying a leasehold house in Millwall ?
The majority of houses in Millwall are freehold and not leasehold. This is one of the situations where having a local solicitor who is familiar with the area can help the conveyancing process. We note that you are purchasing in Millwall so you should seriously consider looking for a Millwall conveyancing practitioner and be sure that they have experience in transacting on leasehold houses. As a matter of priority you will need to check the number of years remaining. Being a leaseholder you will not be entirely free to do whatever you want to the property. The lease will likely included provisions such as obtaining the freeholder’spermission to conduct changes to the property. It may be necessary to pay a service charge towards the maintenance of the estate where the property is part of an estate. Your lawyer should advise you fully on all the issues.
I've recently bought a leasehold flat in Millwall. Am I liable to pay service charges for periods before my ownership?
In a situation where the service charge has already been demanded from the previous lessee 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. 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 am employed by a reputable estate agency in Millwall where we have experienced a few flat sales jeopardised as a result of short leases. I have been given conflicting advice from local Millwall conveyancing solicitors. Please can you shed some light as to whether the owner of a flat can commence the lease extension process for the buyer?
As long as the seller has owned the lease for at least 2 years it is possible, to serve a Section 42 notice to kick-start the lease extension process and assign the benefit of the notice to the purchaser. This means that the proposed purchaser need not have to wait 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment has to be done prior to, or at the same time as 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.
I am the proprietor of a basement flat in Millwall. In the absence of agreement between myself and the freeholder, can the Leasehold valuation Tribunal make a decision on the premium due for the purchase of the freehold?
if there is a missing freeholder or where there is disagreement about the premium for a lease extension, under the Leasehold Reform, Housing and Urban Development Act 1993 you can apply to the Leasehold Valuation Tribunal to judgment on the premium.
An example of a Freehold Enfranchisement case for a Millwall flat is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case was in relation to 3 flats. The unexpired term was 101.61 years.
What are the frequently found deficiencies that you see in leases for Millwall properties?
Leasehold conveyancing in Millwall is not unique. All leases are unique and legal mistakes in the legal wording can result in certain clauses are wrong. The following missing provisions could result in a defective lease:
- A provision to repair to or maintain parts of the premises
- 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. National Westminster Bank, Skipton Building Society, and Aldermore 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 problematic they may refuse to provide security, forcing the buyer to pull out.
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