Factors fees

triggerhappy_2

I live on a managed estate in Glasgow. I have just received my second factors bill and there is one recurring item that is really irritating me. Each quarter we are charged the legal fees for the recovery of debt - this quarter the legal fees came to £2511.60 and the income from that was £292.80.

There's something about this that strikes me as odd as the income has been refunded to us (my share being 1/120). So for my share of the costs, at £20.93, I was refunded £2.44. I would have thought the debt would be unpaid fees to the factor, so surely they should keep the money? Of course, then they couldn't charge us the legal fees, but I have no idea why it's being refunded to us in the first place.

Is the factor up to something dodgy here or do I have to just suck up paying out on legal fees for minimal return?

Jowo_2

As far as I'm aware, property owners are ultimately responsible for paying towards the Factors charges when other owners will not pay.

I'm not sure I fully understand your question but if the Factor are refunding some charges, is it because they managed to enforce payment by the owners who defaulted? And they are returning it to the other owners in the form of a credit?

Have you asked the Factor for an explanation and do they belong to the following organisation?

http://www.pmas.org.uk/

triggerhappy_2

Yes, I realise that we are liable for unpaid factors fees, that I have no problem with (though, I'd rather people paid the bills in the first place!)

It's possible that they have enforced payment, but the bill is quite sketchy - just two lines:

Legal costs for the recovery of debt - total £2511.60, share £20.93
Legal income from the recovery of debt - total -£292.80, share -£2.44

The property manager never returns calls, the main email address is never responded to and they only do site visits during the day on weekdays so I never see them as I'm at work. Most irritating. Doesn't look like they're members of PMAS either

Jowo_2

http://scotland.shelter.org.uk/getadvice/advice_topics/repairs_and_bad_conditions/repairs_and_maintenance_in_common_areas/property_managers_and_factors#5

triggerhappy_2

Not sure I want to take it as far as a complaint against them, I'm just really wondering if this was unusual to be honest. The legal fees are only about £20 a quarter which I can live with, but it's just irritating that they are spending so much money recovering a comparatively small amount. It costs us more to recover it than it would just to pay the fees in the first place. I suppose it has to be done otherwise no one would pay their fees as there would be no repercussions.

I have just had a look at their website where it says we're supposed to have a quartely residents meeting, but that's the first I've heard of it. I think I'll write them a letter and find out what happened with that. Annoyingly, most of the flats around here are rented so the residents don't give a crap about things we get charged for - this quarter we've been charged £500 for 'specialist pick ups' after people have dumped things in the grounds with phoning the council to collect, despite signs in every close saying there will be charges.

Hopefully the legislation on the regulation of factoring companies will go through sooner rather than later. It seems a good business to be in to make some easy money.

Jowo_2

To be honest, I'm not aware of any requirement to have quarterly residents meeting. We've had our factor for a year plus and don't have any. We are happy with our Factor.

We used to be self-factored but in reality, this meant that I ran around doing everything while the other owners moaned or were abusive and refused to pay. Therefore, I am relatively sympathetic to Factors knowing that they get scant cooperation and if owners were left to their own devices, the insides of their properties would be immaculate while the common areas would look like Beirut on a bad day.

Like yourself, many of our problems were caused by the tenants and absent landlords who tended to be extremely poor at disposing of their rubbish (we ended up with rats in the backcourt, and then in the roof of our tenement) and who would not keep their properties maintained, so would flood the flats below, for example.

There is one large modern building in central Glasgow where my Factor said no-one in their trade would manage it because it was well known that there were lots of flats in it owned by untraceable 'ghost' landlords and the buildings insurance had lapsed. He said tenants, among them many junkies, would cycle down the interior corridors and light barbeques inside. Flats never sell on the open market, they have to go to auction despite its origins as 'luxury' riverside apartments. Last time I came across a news article, it was being factored by a company with links to someone convicted of murder...

theartfullodger

See

http://www.govanlc.com/factors.htm


...
eg "Sack your Factor" etc

Jowo_2

It must be tricky to sack a factor when there are 120 owners involved, many of them being owned by non-occupiers. It was hard enough raising enough votes to engage a factor in a tenement of 8 flats, mainly owner occupied. Also, some factors were not prepared to take on our tenement because there was an absent landlord who had not paid the self factoring fees.

Therefore, good luck to the OP if he thinks he can get 61 votes and find a Factor willing to take on account which has lots of non-payers.

triggerhappy_2

Jowo wrote: »

To be honest, I'm not aware of any requirement to have quarterly residents meeting. We've had our factor for a year plus and don't have any. We are happy with our Factor.

We used to be self-factored but in reality, this meant that I ran around doing everything while the other owners moaned or were abusive and refused to pay. Therefore, I am relatively sympathetic to Factors knowing that they get scant cooperation and if owners were left to their own devices, the insides of their properties would be immaculate while the common areas would look like Beirut on a bad day.

Like yourself, many of our problems were caused by the tenants and absent landlords who tended to be extremely poor at disposing of their rubbish (we ended up with rats in the backcourt, and then in the roof of our tenement) and who would not keep their properties maintained, so would flood the flats below, for example.

There is one large modern building in central Glasgow where my Factor said no-one in their trade would manage it because it was well known that there were lots of flats in it owned by untraceable 'ghost' landlords and the buildings insurance had lapsed. He said tenants, among them many junkies, would cycle down the interior corridors and light barbeques inside. Flats never sell on the open market, they have to go to auction despite its origins as 'luxury' riverside apartments. Last time I came across a news article, it was being factored by a company with links to someone convicted of murder...

I know the development you mean, and it was my current factors that were the factors for it originally. I know it's not really easy money, and I'm more annoyed at the absent landlords that are causing these costs on my factors bill. If I were given the choice of chasing it or paying the unpaid fees, I'd just pay the fees as it's be cheaper, but I realise this will lead to people simply not paying without repercussion. Just infuriating to be paying £20 a quarter to recoup £2.50!

I wouldn't want to self factor (and I suspect this would be impossible in a development with 120 properties!) but I would like the factro to be a little more communicative. I wasn't suggesting that quarterly meetings were required, but on their own website they suggest they do have them, when in 8 months here I haven't heard a peep. I would be happy to sit on a residents association, but there simply doesn't seem to be one.

Thanks for your input on this Jowo, helped me put things in perspective a bit!

Artful - you're a landlord... would you question this kind of charge?

triggerhappy_2

Jowo wrote: »

It must be tricky to sack a factor when there are 120 owners involved, many of them being owned by non-occupiers. It was hard enough raising enough votes to engage a factor in a tenement of 8 flats, mainly owner occupied. Also, some factors were not prepared to take on our tenement because there was an absent landlord who had not paid the self factoring fees.

Therefore, good luck to the OP if he thinks he can get 61 votes and find a Factor willing to take on account which has lots of non-payers.

No chance at all of me organising the sacking of the factor! Your assessment of the development is, sadly, correct. Fortunately, unlike in your example of the waterside development, things are ticking over quite well here. It's just these legal fees that are bothering me.

If they're only losing £300 in unpaid fees in a quarter I think we're doing quite well.

Jowo_2

To clarify, these 'legal' fees, are these charges solely the court and solicitor charges to chase outstanding owner payments?

Does this mean there are also % of maintenance charges you have to cover on top, too, caused by non-payment of the same owners towards the general charges?

Are you able to get a break-down of which owners owe how much?

In our tenement, our Factor provided me with a copy of the invoice of the flat that owed the money and their specific legal fees was just a small charge to put a notice of liability on the Deeds at Registers Scotland which they did themselves. So far, in a year plus of factoring our building, they have not pursued the other owners for the non-payment by that particular flat. The flat was repossessed by the lender and so I assume that the Factor will be paid their money when it sells, due to the notice of liability.

Do you know if the Factors have put Notice of Liability on the properties that owe the money? This means that the property cannot be sold until either the seller or the buyer pays it off and it lasts for 5 years. Registrars Scotland website will indicate how much it is to put a note against the Deeds.

Also, even to take an owner to the Sheriff Court isn't particularly expensive - under £100 I think, to bring a case against an owner.

Why are the legal fees to pursue non paying owners approaching £2500!?