Old St Mellons leasehold conveyancing: Q and A’s
I am tempted by the attractive purchase price for a couple of apartments in Old St Mellons both have approximately 50 years left on the lease term. Will this present a problem?
There are no two ways about it. A leasehold apartment in Old St Mellons is a wasting asset as a result of the reducing lease term. The closer the lease gets to zero years unexpired, the more it reduces the marketability of the premises. For most purchasers and mortgage companies, leases with less than 75 years become less and less attractive. On a more upbeat 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 property 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 Old St Mellons 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.
I've recently bought a leasehold house in Old St Mellons. Am I liable to pay service charges relating to a period prior to 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. However, your landlord may still be able to take action to forfeit the lease. A critical element 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).
I am employed by a long established estate agency in Old St Mellons where we see a number of flat sales derailed as a result of short leases. I have received contradictory information from local Old St Mellons conveyancing firms. Can you clarify whether the vendor of a flat can commence the lease extension formalities for the buyer?
As long as the seller has been the owner 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. This means that the buyer can avoid having to sit tight for 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 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.
We expect to complete our sale of a £475000 garden flat in Old St Mellons next Thursday . The management company has quoted £312 for Landlord’s certificate, insurance certificate and previous years service charge statements. Is it legal for a freeholder to charge exorbitant fees for a flat conveyance in Old St Mellons?
Old St Mellons conveyancing on leasehold flats nine out of ten times necessitates administration charges invoiced by management companies :
- Addressing pre-exchange questions
- Where consent is required before sale in Old St Mellons
- Copies of the building insurance and schedule
- Deeds of covenant upon sale
- Registering of the assignment of the change of lessee after a sale
In relation to leasehold conveyancing in Old St Mellons what are the most common lease defects?
Leasehold conveyancing in Old St Mellons is not unique. Most leases are unique and legal mistakes in the legal wording can sometimes mean that certain sections are missing. For example, if your lease is missing any of the following, it could be defective:
- Repairing obligations to or maintain elements of the premises
- 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 will likely cause problems when trying to sell a property primarily because it impacts on the ability to obtain a mortgage on the property. Santander, The Royal Bank of Scotland, and Barclays Direct 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 provide security, obliging the purchaser to pull out.
I am the registered owner of a garden flat in Old St Mellons, conveyancing having been completed in 2000. Can you let me have an estimate of the premium that my landlord can legally expect in return for granting a renewal of my lease? Equivalent flats in Old St Mellons with over 90 years remaining are worth £259,000. The ground rent is £60 invoiced annually. The lease expires on 21st October 2090
With just 65 years remaining on your lease the likely cost is going to be between £18,100 and £20,800 plus legals.
The suggested premium range that we have given is a general guide to costs for renewing a lease, but we are not able to supply a more accurate figure without more comprehensive investigations. You should not use this information in a Notice of Claim or as an informal offer. There may be additional concerns that need to be considered and clearly you want to be as accurate as possible in your negotiations. Neither should you take any other action placing reliance on this information without first seeking the advice of a professional.
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