Countrywide Property Lawyers again - can they do this?

Kittenonthekeys

On the point of exchanging contracts, when our buyers solicitors (the celebrated, oft-mentioned Countrywide Property Lawyers) suddenly took it upon themselves to insist that we buy the freehold title NOW on our leasehold house that we're in the process of selling (straightforward local authority lease with over 100 yrs to run) before the sale can proceed. Not only would this cost us money for something we will never benefit from, but even more importantly, would take months to arrange that we just don't have, as we would lose the house we are buying, mortgage offers would expire, etc.
It was made crystal clear to all at the start that this is a leasehold house (unusual in many places but normal in our area) with the option to buy the f/h after only 2 years of ownership, so the buyers could buy it themselves in 2 years, if they choose to.
Our buyers (first time buyers) got their valuation done immediately and their mortgage offer came through ages ago. They have so far not asked us for anything but to move in asap. Our solicitor is hopping mad with CPL (based in Cardiff - at the opposite end of the country to us) and trying to get them to drop the matter but they refuse to listen to her experience and local knowledge and are digging their heels in over this. Our estate agent has been totally useless ever since the day we went under offer (we are now on our 2nd set of buyers after the first lot fell through because the buyer at the bottom of the chain lost their job) so no use asking them to do anything; it wouldn't surprise me if they introduced our buyers to CPL in the first place!

There are only 3 parties in the chain and all want to move. We are thinking of having a chinwag with our buyers about this when they come round to measure up, etc.
We're getting stressed as this sale seems to have been going on forever and feel quite desperate now as we've heard so many awful stories about CPL.
We all just want to exchange contracts.
Can they really insist we buy the freehold prior to selling? Is there anything we can do to make them drop the matter if our solicitor cannot convince them that they will still be getting a sound title guaranteed by the Land Reg and that they are being totally unreasonable?

Hippychick

Not quite sure why they want you to buy the freehold, the only reasons I could think of were:

a) lease is short - if 100 yrs left then this is not applicable
b) your lease is majorly defective in some way and purchasing the freehold will 'remove' the defects - check if this is the case.
c) they can't be bothered to do the additional legwork involved with checking a leasehold title (most likely)

As long as your lease is sound and you can provide good title to your buyers (your solicitor can confirm) then I would tell the buyers to speak to their sols and persuade them to drop it. If you can provide good title then there is certainly no obligation for you to purchase the freehold as well.

Kittenonthekeys

Hippychick wrote: »

Not quite sure why they want you to buy the freehold, the only reasons I could think of were:

a) lease is short - if 100 yrs left then this is not applicable
b) your lease is majorly defective in some way and purchasing the freehold will 'remove' the defects - check if this is the case.
c) they can't be bothered to do the additional legwork involved with checking a leasehold title (most likely)

As long as your lease is sound and you can provide good title to your buyers (your solicitor can confirm) then I would tell the buyers to speak to their sols and persuade them to drop it. If you can provide good title then there is certainly no obligation for you to purchase the freehold as well.

Thank you - the lease is simple, and straightforward with no defects. And yes, our sol. has confirmed that good title can be provided.
I certainly agree with you about (c).

Kittenonthekeys

Surely though, even if the lease had been defective, would it really matter as the buyers have the right to buy the freehold anyway after 2 years?

Ulfar

I would make it clear that the house was advertised as leasehold.

There should be no problem because as you have stated there is 100 years to run. If the buyers want the freehold then that is up to them unless they want to up the offer.

bitsandpieces

Kittenonthekeys wrote: »

Can they really insist we buy the freehold prior to selling? Is there anything we can do to make them drop the matter if our solicitor cannot convince them that they will still be getting a sound title guaranteed by the Land Reg and that they are being totally unreasonable?

They can insist that you paint the place pink with gold spots prior to exchange, if they want - at this point, pretty much everything is open to negotiation. The freehold thing is an odd request, though - unless CPL have noticed something your sol has missed...but suspect the problem may be at the CPL end. Another possibility - are there any big costs associated with being a leaseholder which the buyer might be getting cold feet about?

If the EA are linked to CPL (you say you suspect they may have referred buyers) it may actually be worth you getting them to chase CPL, even if EA has been lousy in the past. If EA has a business relationship with CPL, they may be able to get them to be a bit more sensible/

Richard_Webster

Not quite sure why they want you to buy the freehold, the only reasons I could think of were:

a) lease is short - if 100 yrs left then this is not applicable
b) your lease is majorly defective in some way and purchasing the freehold will 'remove' the defects - check if this is the case.
c) they can't be bothered to do the additional legwork involved with checking a leasehold title (most likely)

As long as your lease is sound and you can provide good title to your buyers (your solicitor can confirm) then I would tell the buyers to speak to their sols and persuade them to drop it. If you can provide good title then there is certainly no obligation for you to purchase the freehold as well.

Quite possible it could be one of these - or buyer forgot to tell his mortgage lender about it being leasehold and he has a mortgage offer to buy a freehold house. CPL charge about another £200 + VAT for dealing with leaseholds so possibly this may be a reason as well.

Certainly worth trying to make direct contact with buyers to find out what their concern is.

Running_Horse

From memory, CPL state you pay nothing if the sale falls through. Is it worth calling their bluff and risking them not being paid? It might focus minds.

Kittenonthekeys

Spoke to buyers today and it was all news to them, as CPL had not even consulted them first; they have no idea why CPL have taken it upon themselves to do this and
they are quite happy to buy the f/h when the time comes and, like everyone else in the chain, just want to get it all done and dusted asap.
It turns out that our EA had not recommended CPL at all.
Our buyers will instruct them to stop pursuing it.
The lease is fine, there is only a modest annual peppercorn ground rent with no extra charges so I can only imagine it might be as Hippychick suggested - that they can't be bothered to do the extra work associated with leasehold title.

Richard_Webster

At one time CPL farmed out leasehold cases to firms of solicitors who agreed to abide by CPL's charging structure. I don't know whether this is still the case. If so it might be another explanation.