Recently asked questions relating to Shildon leasehold conveyancing
I am looking at a couple of apartments in Shildon which have in the region of fifty years unexpired on the leases. Should I regard a short lease as a deal breaker?
There is no doubt about it. A leasehold flat in Shildon is a deteriorating asset as a result of the reducing lease term. The closer the lease gets to its expiry date, the more it adversely affects the marketability of the premises. For most buyers and banks, leases with under 75 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 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 Shildon 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 flat in Shildon. Do I have any liability for 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. It is an essential part 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).
What are your top tips when it comes to choosing a Shildon conveyancing practice to deal with our lease extension?
If you are instructing a solicitor for lease extension works (regardless if they are a Shildon conveyancing practice) it is imperative that they be familiar with the legislation and specialises in this area of conveyancing. We suggested that you speak with two or three firms including non Shildon conveyancing practices prior to instructing a firm. If the firm is ALEP accredited then that’s a bonus. Some following of questions could be of use:
- How many lease extensions has the firm carried out in Shildon in the last twenty four months?
Can you provide any advice for leasehold conveyancing in Shildon with the aim of expediting the sale process?
- A significant proportion of the delay in leasehold conveyancing in Shildon can be bypassed where you instruct lawyers the minute you market your property and request that they start to put together the leasehold documentation needed by the buyers representatives.
- Many freeholders or Management Companies in Shildon charge for supplying management packs for a leasehold property. You or your lawyers should enquire as to the actual amount of the charges. The management information can be applied for as soon as you have a buyer, thus reducing delays. The typical amount of time it takes to obtain the necessary information is three weeks. It is the most common reason for frustration in leasehold conveyancing in Shildon.
What are the common deficiencies that you see in leases for Shildon properties?
Leasehold conveyancing in Shildon is not unique. Most leases are individual and legal mistakes in the legal wording can result in certain sections are erroneous. For example, if your lease is missing any of the following, it could be defective:
- Repairing obligations to or maintain elements 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 problems when trying to sell a property as they can affect a potential buyer’s ability to obtain a mortgage. Birmingham Midshires, The Mortgage Works, 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 is problematic they may refuse to provide security, forcing the buyer to pull out.
I acquired a 1st floor flat in Shildon, conveyancing was carried out half a dozen years ago. Can you please calculate a probable premium for a statutory lease extension? Corresponding flats in Shildon with an extended lease are worth £175,000. The average or mid-range amount of ground rent is £45 invoiced annually. The lease ends on 21st October 2095
You have 73 years left to run we estimate the price of your lease extension to range between £10,500 and £12,000 as well as plus your own and the landlord's "reasonable" professional fees.
The suggested premium range that we have given is a general guide to costs for renewing a lease, but we cannot give you a more accurate figure without more comprehensive investigations. Do not use the figures in a Notice of Claim or as an informal offer. There are no doubt other issues that need to be considered and clearly you should be as accurate as possible in your negotiations. Please do not take any other action placing reliance on this information before getting professional advice.