I can't afford my service charges - help

Cyril

Ok the story goes that I bought a flat and on investigating the lease my solicitor found that there were going to be works carried out that the freeholder estimated would be a value of around 2,500. This was paid in advance by the seller and all was well for a while until the works estimates came in at 6,500. The works have stalled and stalled due to lack of access and in the meantime I paid 1100, then another 600 and then another 500. So in total they have had 4700

On friday I got a final bill for 3500 ( ending up at 8200 ) and I just don't have the money. I know the lease costs are a priority debt but when they first told us of the costs I said that I wouldn't be able to afford them in the recession ( I work in the construction industry and as we know no-one is constructing ) but they were quite bullyish and said they were going ahead anyway cos the council wanted the area smartened up.

The problem is they have threatened legal action if I don't pay. The only option I have is to pay by instalments but they are giving me till the end of March and being on a low income it only really covers my outgoings anyway but I could probably scrape together a couple of hundred a month.

I can't borrow money as my credit rating is shot to pieces and the flat is worth nothing so not worth selling.

Whats the worst that could happen

dancingfairy

I would want to know how the costs can have gone from 2,500 to over 8,000 - that sounds ridiculous. Perhaps you need to get the solicitor on this one.
I would also dig out your contract and see what it says aout paying for works to be done - surely you don't just sign an open ended cheque when you buy a flat?
Perhaps National Debtline can tell you what they can do if you don't pay the debt - it is different type of debt to the ones normally covered on here so I'm not sure.
Hope that helps a little.
df

niccatw

I really feel for you Cyril! I live in a flat in Scotland and it's factored by the Housing Association. As the rest of the block rent, I would have ne say over works going ahead either.

I think my t&c's state I'm liable to pay within two weeks when the cost is under a certain amount (I can't remember the amont offhand, but it's something like 2k - which I wouldn't be able to pay within 2 weeks!). Anything over that then they are obliged to let you pay up. Especially if it comes in at over the estimated cost! Not sure if that's a Scottish thing or a city coucil thing...

I know you'll be fully aware of the types of things that bump the costs up, having a construction background, but that is some jump! I'd seriously be questioning it, asking for a break down of costs and where you're previous payments have gone.

Perhaps the Shelter website could give you advice on your rights or where to go for further information http://www.shelter.org.uk/ I've used it on numerous occasions, from info about factors to letting out my spare room; there's loads of info, so hopefully you will find something useful to your situation.

Good luck