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  • FIRST POST
    • Actor31
    • By Actor31 16th Mar 17, 6:16 PM
    • 11Posts
    • 1Thanks
    Actor31
    no sinking fund
    • #1
    • 16th Mar 17, 6:16 PM
    no sinking fund 16th Mar 17 at 6:16 PM
    I live in a block of flats and the council have put new balconies and refurbed the outside and also fitted new front doors and it was to come out of the sinking fund in the service charge.
    But I have been informed that there is no money in the sinking fund so they have given me a bill of £15,469 pound, they have also sent a letter offering options they get equity in the flat or i can have a loan which i cannot pay and they have also advised that my service charge was set to low. If i had known beforehand that i would have to pay for the said works i would have ask them not to do them. because i cannot afford or find this huge amount of money. what do I do and what are my options.
Page 1
    • marliepanda
    • By marliepanda 16th Mar 17, 6:20 PM
    • 4,884 Posts
    • 9,842 Thanks
    marliepanda
    • #2
    • 16th Mar 17, 6:20 PM
    • #2
    • 16th Mar 17, 6:20 PM
    I take it you own?

    Yeah that's basically the one huge warning that everyone says about buying in a council block. You get no say over the refurbishments and you have to pay because you chose to buy. Council tenants will not:

    You also don't get to deny the other tenants the right to a refurb because you don't want to pay.
    Survey Earnings 2017 - £163
    • AdrianC
    • By AdrianC 16th Mar 17, 7:06 PM
    • 15,728 Posts
    • 14,033 Thanks
    AdrianC
    • #3
    • 16th Mar 17, 7:06 PM
    • #3
    • 16th Mar 17, 7:06 PM
    How much of your service charge goes towards this sinking fund? What do the last accounts you were sent say about the balance? Is this really the absolute first notification you've had?
    • eddddy
    • By eddddy 16th Mar 17, 7:15 PM
    • 5,546 Posts
    • 5,230 Thanks
    eddddy
    • #4
    • 16th Mar 17, 7:15 PM
    • #4
    • 16th Mar 17, 7:15 PM
    Any major works where your contribution would be over £250 should have gone through a section 20 consultation process. So the cost shouldn't be a surprise.

    See: http://www.lease-advice.org/advice-guide/section-20-consultation-for-private-landlords-resident-management-companies-and-their-agents/

    Also, are any of the works for improvements (as apposed to maintenance and repairs)? If so, check your lease to see if you are required to pay for improvements.
    • Actor31
    • By Actor31 18th Mar 17, 3:42 PM
    • 11 Posts
    • 1 Thanks
    Actor31
    • #5
    • 18th Mar 17, 3:42 PM
    • #5
    • 18th Mar 17, 3:42 PM
    I was told that the improvements would be paid out of my sinking fund, which is what happened in the past with maintenance and when the old balconies needed repairing. But i have been informed with this recent bill that i have nothing in my sinking fund. i had no say in whether or not I wanted the work done because it is a 12 storey block of flats. i have also been informed my service charge was too low and that is also going up
    • Actor31
    • By Actor31 18th Mar 17, 3:44 PM
    • 11 Posts
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    Actor31
    • #6
    • 18th Mar 17, 3:44 PM
    • #6
    • 18th Mar 17, 3:44 PM
    The cost is not the surprise, the fact that my sinking fund will cover it is.
    • hazyjo
    • By hazyjo 18th Mar 17, 4:10 PM
    • 9,839 Posts
    • 12,484 Thanks
    hazyjo
    • #7
    • 18th Mar 17, 4:10 PM
    • #7
    • 18th Mar 17, 4:10 PM
    Very common for private owners of ex-LA flats to get a big bill land on their doorstep. Did nobody warn you when you bought it? I've been saying it for years on here...

    Not much you can do I'm afraid. They just do it and bill you. If there's a lift, that can result in another big bill. Could you sell and buy cheaper or take a personal loan?

    Second job?

    Jx
    2017 wins: Opera tickets; film preview; lipstick; Ideal Home Show tickets + afternoon tea & bottle of Champagne; 2 cases of NKD; notebook; bath rack; books; film Premiere; Broadchurch DVDs; lipbalms; hamper (food/wine/Echo Dot/Jo Malone goodies); Avon lippies; cowhide rug; Windsor luxury break, foundation; Flybe flight
    • Actor31
    • By Actor31 18th Mar 17, 9:09 PM
    • 11 Posts
    • 1 Thanks
    Actor31
    • #8
    • 18th Mar 17, 9:09 PM
    • #8
    • 18th Mar 17, 9:09 PM
    live on a rough area nothing cheaper and was hard enough to get one job
    • Actor31
    • By Actor31 18th Mar 17, 9:10 PM
    • 11 Posts
    • 1 Thanks
    Actor31
    • #9
    • 18th Mar 17, 9:10 PM
    • #9
    • 18th Mar 17, 9:10 PM
    Cant afford a loan be better off out of work
    • hazyjo
    • By hazyjo 18th Mar 17, 10:42 PM
    • 9,839 Posts
    • 12,484 Thanks
    hazyjo
    You still haven't confirmed - we are presuming you bought this property. Not sure why a lender gave you a mortgage (presuming they did) if money is that tight. Plus they don't usually lend on ex-LA flats more than 4 or 5 storeys (unless parts of London?). Wouldn't it have been easier to rent? Can you elaborate? Have your circumstances changed since you got the flat? Is someone else meant to be contributing?

    Jx
    2017 wins: Opera tickets; film preview; lipstick; Ideal Home Show tickets + afternoon tea & bottle of Champagne; 2 cases of NKD; notebook; bath rack; books; film Premiere; Broadchurch DVDs; lipbalms; hamper (food/wine/Echo Dot/Jo Malone goodies); Avon lippies; cowhide rug; Windsor luxury break, foundation; Flybe flight
    • always_sunny
    • By always_sunny 19th Mar 17, 9:47 AM
    • 3,489 Posts
    • 3,713 Thanks
    always_sunny
    If i had known beforehand that i would have to pay for the said works i would have ask them not to do them. because i cannot afford or find this huge amount of money. what do I do and what are my options.
    Originally posted by Actor31
    Are you suggesting that the Freeholder did the work without consulting Leaseholders and then give all of you £15,469 bill?

    I thought that:
    With that in mind though, you should/would know if there is a sinking fund cause you'd pay into it. If you don't pay nothing towards a sinking fund (Ground Rent and Service Charges are obviously not the same) then why would you be surprised after? As a home owner you need to pay all costs (or share of the total cost with other leaseholders).
    Expat with an EU passport
    • csgohan4
    • By csgohan4 19th Mar 17, 10:10 AM
    • 4,018 Posts
    • 2,498 Thanks
    csgohan4
    live on a rough area nothing cheaper and was hard enough to get one job
    Originally posted by Actor31


    So instead of waiting and biding your time you jumped into the deep end and bought a flat without looking at the consequences?
    "It is prudent when shopping for something important, not to limit yourself to Pound land"
    • freeisgood
    • By freeisgood 19th Mar 17, 10:51 AM
    • 495 Posts
    • 772 Thanks
    freeisgood
    Its a headache...I know someone who privately owned a council flat...refused to have their windows replaced to save themselves money ( as the council was replacing every window on the block) she still got a bill in the thousands for the scaffolding etc etc..even though no new windows for her
    • Actor31
    • By Actor31 19th Mar 17, 11:45 AM
    • 11 Posts
    • 1 Thanks
    Actor31
    all 3 blocks had all of the outside improved it cost millions and tenants also had the inside of the flats improved.and my sinking fund is taken out of my service charge a few years ago a housing association took over from the council.
    • marliepanda
    • By marliepanda 19th Mar 17, 12:19 PM
    • 4,884 Posts
    • 9,842 Thanks
    marliepanda
    How much do you pay into the sinking fund? (its been asked a few times)


    How long have you lived there? Did you expect to have paid £15k or so into it?


    Again, did this not come up at any point when you bought it? I have never bought a council flat or even lived in one but I know the huge pitfalls of enforced repairs that buying in council blocks can cause.
    Survey Earnings 2017 - £163
    • Actor31
    • By Actor31 19th Mar 17, 1:16 PM
    • 11 Posts
    • 1 Thanks
    Actor31
    been in the flat for about 20 years it was not repair it was improvements, new balconies, windows, and the exterior cladded, some flats are lease holders some are tenants and found out that lease holders have all got different bills because the service charge which includes sinking fund are different even for the same size flat, because the flats were were purchased at different times. i was informed that it would come out of my sinking fund but than find out 12 months later i have nothing left in my sinking fund. i asked then if they wanted to buy it back but they don't want it.
    • Actor31
    • By Actor31 19th Mar 17, 1:23 PM
    • 11 Posts
    • 1 Thanks
    Actor31
    I have some satisfaction that by posting on this site my experience, it will hopefully make people check and seek expert advice before purchasing a leasehold off an housing association or council.
    • xylophone
    • By xylophone 19th Mar 17, 4:54 PM
    • 23,653 Posts
    • 13,782 Thanks
    xylophone
    Have you been making regular payments into the sinking fund?
    • Actor31
    • By Actor31 19th Mar 17, 8:51 PM
    • 11 Posts
    • 1 Thanks
    Actor31
    Yes it was included in my service charge
    • Actor31
    • By Actor31 20th Mar 17, 11:56 AM
    • 11 Posts
    • 1 Thanks
    Actor31
    Its 5th floor flat Manchester and the mortgage was less than the rent, but i suppose you live and learn
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