Fixed-fee leasehold conveyancing in Valley:

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Valley leasehold conveyancing: Q and A’s

Last month I purchased a leasehold property in Valley. Do I have any liability for service charges relating to a period prior to my ownership?

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. It is an essential part 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 a negotiator for a busy estate agency in Valley where we have witnessed a few flat sales derailed as a result of leases having less than 80 years remaining. I have been given conflicting advice from local Valley conveyancing solicitors. Could you confirm whether the owner of a flat can initiate the lease extension process for the purchaser on completion of the sale?

Provided that 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 can avoid having 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 purchaser.

Do you have any top tips for leasehold conveyancing in Valley with the intention of speeding up the sale process?

  • A significant proportion of the frustration in leasehold conveyancing in Valley can be bypassed if you instruct lawyers the minute you market your property and ask them to collate the leasehold information which will be required by the buyers solicitors.
  • The majority freeholders or managing agents in Valley charge for providing management packs for a leasehold premises. You or your lawyers should find out the actual amount of the charges. The management pack can be applied for as soon as you have a buyer, thus accelerating the process. The typical amount of time it takes to obtain the necessary information is three weeks. It is the most usual reason for frustration in leasehold conveyancing in Valley.
  • If you have carried out any alterations to the property would they have required Landlord’s approval? In particular have you laid down wooden flooring? Valley leases often stipulate that internal structural changes or laying down wooden flooring calls for a licence issued by the Landlord approving such changes. Should you fail to have the approvals in place you should not communicate with the landlord without contacting your lawyer in advance.
  • If there is a history of conflict with your freeholder or managing agents it is very important that these are resolved prior to the flat being put on the market. The purchasers and their solicitors will be warry about purchasing a flat where a dispute is unresolved. You may need to swallow your pride and pay any arrears of service charge or settle the dispute prior to the buyers completing the purchase. It is therefore preferable to have any dispute settled ahead of the contract papers being issued to the buyers’ solicitors. You are still duty bound to disclose details of the dispute to the buyers, but it is better to present the dispute as over as opposed to ongoing.
  • If you hold a share in a the Management Company, you should ensure that you are holding the original share certificate. Arranging a duplicate share certificate can be a lengthy formality and slows down many a Valley conveyancing deal. If a duplicate share is needed, you should approach the company director and secretary or managing agents (where relevant) for this at the earliest opportunity.

    • Our conveyancer has advised that he intends to complete and exchange simultaneously on the disposal of our £200000 maisonette in Valley on Thursday in a week. The managing agents has quoted £300 for Certificate of Compliance, building insurance schedule and previous years service charge statements. Is it legal for a freeholder to charge such fees for a flat conveyance in Valley?

    Valley conveyancing on leasehold maisonettes normally requires the purchaser’s lawyer sending questions for the landlord to address. Although the landlord is not legally bound to address these enquiries the majority will be content to assist. They are at liberty levy a reasonable administration fee for responding to enquiries or supplying documentation. There is no upper cap for such fees. The average costs for the paperwork that you are referring to is £350, in some situations it is in excess of £800. The administration charge demanded by the landlord must be sent together with a summary of rights and obligations in relation to administration fees, without which the charge is not strictly payable. In reality one has no option but to pay whatever is demanded should you wish to exchange contracts with the buyer.

    What makes a Valley lease defective?

    There is nothing unique about leasehold conveyancing in Valley. All leases are unique and legal mistakes in the legal wording can result in certain provisions are wrong. The following missing provisions could result in a defective lease:

    • Repairing obligations to or maintain elements of the building
    • 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

    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. Santander, Bank of Scotland, and Britannia all have very detailed conveyancing instructions when it comes to what is expected in a lease. If a mortgage lender believes that the lease does not cover certain provisions they may refuse to grant the mortgage, obliging the buyer to pull out.

    I invested in buying a 1 bedroom flat in Valley, conveyancing was carried out in 2009. Can you work out an approximate cost of a lease extension? Equivalent flats in Valley with an extended lease are worth £255,000. The ground rent is £55 per annum. The lease expires on 21st October 2086

    With only 60 years left to run we estimate the price of your lease extension to be between £23,800 and £27,400 as well as legals.

    The figure above a general guide to costs for renewing a lease, but we are not able to supply a more accurate figure in the absence of detailed due diligence. Do not use this information in a Notice of Claim or as an informal offer. There may be additional issues that need to be taken into account and clearly you want to be as accurate as possible in your negotiations. You should not move forward placing reliance on this information before getting professional advice.

    Other Topics

    Lease Extensions in Valley