My wife and I purchased a leasehold flat in Moorgate. Conveyancing and Alliance & Leicester mortgage are in place. A letter has just been received from someone claiming to own the reversionary interest in the property. Attached was a ground rent demand for rent dating back to 1993. The conveyancing practitioner in Moorgate who acted for me is not around.Any advice?

First contact the Land Registry to be sure that the individual claiming to own the freehold is indeed the registered owner of the freehold reversion. It is not necessary to incur the fees of a Moorgate conveyancing firm to do this as it can be done on-line for a few pound. You should note that regardless, even if this is the rightful freeholder, under the Limitation Act 1980 no more than 6 years of rent can be collected.

I am tempted by the attractive purchase price for a couple of flats in Moorgate both have about 50 years unexpired on the lease term. Should I regard a short lease as a deal breaker?

There are plenty of short leases in Moorgate. The lease is a right to use the premises for a period of time. As the lease gets shorter the saleability of the lease reduces and it becomes more expensive to extend the lease. For this reason it is generally wise to extend the lease term. More often than not it is difficulties arise selling premises with a short lease because mortgage companies may be reluctant to lend money on properties of this type. Lease enfranchisement can be a difficult process. We recommend you get professional assistance from a solicitor and surveyor with experience in this field

I've recently bought a leasehold flat in Moorgate. 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 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. 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 long established estate agency in Moorgate where we see a few flat sales put at risk as a result of leases having less than 80 years remaining. I have received conflicting advice from local Moorgate conveyancing firms. Can you clarify whether the owner of a flat can commence the lease extension process for the purchaser on completion of the sale?

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. The benefit of this is that the buyer need not have to wait 2 years to extend their lease. Both sets of lawyers will agree to form of assignment. The assignment needs to be completed before, or simultaneously with 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.

I have given up trying to purchase the freehold in Moorgate. Can this matter be resolved via the Leasehold Valuation Tribunal?

in cases where 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 LVT to assess the premium.

An example of a Lease Extension decision for a Moorgate 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 number of years remaining on the existing lease(s) was 72.39 years.

What makes a Moorgate lease defective?

Leasehold conveyancing in Moorgate is not unique. Most leases are unique and legal mistakes in the legal wording 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 elements of the property
• Insurance obligations
• 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

A defective lease can cause issues when trying to sell a property as they can affect a potential buyer’s ability to obtain a mortgage. Accord Mortgages Ltd, Virgin Money, and Nottingham Building Society 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 does not cover certain provisions they may refuse to grant the mortgage, forcing the purchaser to pull out.

Other Topics

Lease Extensions in Moorgate