Questions and Answers: Cleckheaton leasehold conveyancing
Estate agents have just been given the go-ahead to market my 2 bed flat in Cleckheaton.Conveyancing lawyers have not yet been instructed but I have just had a half-yearly service charge invoice – should I leave it to the buyer to sort out?
The sensible thing to do is pay 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 managing agents will not acknowledge the buyer unless 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 own a leasehold flat in Cleckheaton. Conveyancing and HSBC Bank mortgage organised. A letter has just been received from someone saying they have taken over the freehold. It included a ground rent demand for rent dating back to 1995. The conveyancing practitioner in Cleckheaton who previously acted has now retired.Do I pay?
First contact HMLR to make sure that this person is in fact the new freeholder. There is no need to instruct a Cleckheaton conveyancing solicitor to do this as it can be done on-line for £3. You should note that regardless, even if this is the rightful landlord, 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 maisonettes in Cleckheaton both have in the region of forty five years unexpired on the lease term. Do I need to be concerned?
There is no doubt about it. A leasehold flat in Cleckheaton is a wasting asset as a result of the reducing lease term. The nearer the lease gets to zero years unexpired, the more it adversely affects the salability of the premises. For most purchasers and lenders, leases with less than eighty 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 Cleckheaton 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 Cleckheaton. 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. 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).
What are your top tips when it comes to choosing a Cleckheaton conveyancing practice to deal with our lease extension?
When appointing a solicitor for your lease extension (regardless if they are a Cleckheaton conveyancing practice) it is most important that they be familiar with the legislation and specialises in this area of work. We recommend that you speak with two or three firms including non Cleckheaton conveyancing practices before you instructing a firm. If the firm is ALEP accredited then so much the better. Some following of questions could be helpful:
- How familiar is the practice with lease extension legislation?
- What are the legal fees for lease extension conveyancing?
I acquired a 2 bed flat in Cleckheaton, conveyancing was carried out half a dozen years ago. How much will my lease extension cost? Corresponding properties in Cleckheaton with a long lease are worth £230,000. The average or mid-range amount of ground rent is £60 invoiced annually. The lease comes to an end on 21st October 2086
With just 60 years left to run we estimate the premium for your lease extension to range between £20,900 and £24,200 plus plus your own and the landlord's "reasonable" professional fees.
The figure that we have given is a general guide to costs for renewing a lease, but we cannot give you the actual costs in the absence of detailed investigations. Do not use the figures in tribunal or court proceedings. There are no doubt additional issues that need to be taken into account and clearly you should be as accurate as possible in your negotiations. Neither should you take any other action placing reliance on this information before getting professional advice.