Yet Another Freehold Flat Question!

westv

Sorry I know that the question about freehold flats and mortgages has been asked many times before, I just wanted to add a quick question.

I've downloaded the title of the flat ( the block has 14 flats in total) I'm interested in from the Land Reg and in it it refers to the freehold of the property outlined in red (the flat I'm thinking of buying) and the registerd owner is (as far as I am aware) the current owner of the flat I'm buying.

However, there is also mention of the land having rights granted by a deed between the people who first bought the flat and a limited company that sounds like it was set up to deal with the block as a whole. The ltd. co. is still going as I have been able to download it's 31/12/10 accounts.

At first glance the flat does seems to be the type of freehold flat which could be unmortgageable if I wanted to sell in the future. Does that sound correct? I believe there is also a lease involved but I don't have the details.

There is also currently a service charge.

westv

Just to add, I have seen EA's details in the past where they mention a particular property is unmortgageable for various reasons or they say "cash buyers only".
The details of the place I'm considering say nothing. Are EAs obliged to reveal this information (if applicable) in property details?

G_M

Look up the land registry details again. Are there two seperate entries, one for the leasehold and one for the freehold? That is what it sounds like.

You can buy these either seperately or you can buy them together. The deed you refer to is probobly the original lease that was created by the limited company and sold to the first leaseholder. He sold the lease on and so on. If the freehold (or more probobly a share of it since all the other flat leaseholders in the building will also have shares in the freehold of the building) is also for sale, you can buy this too.

westv

G_M wrote: »

Look up the land registry details again. Are there two seperate entries, one for the leasehold and one for the freehold? That is what it sounds like.

You can buy these either seperately or you can buy them together. The deed you refer to is probobly the original lease that was created by the limited company and sold to the first leaseholder. He sold the lease on and so on. If the freehold (or more probobly a share of it since all the other flat leaseholders in the building will also have shares in the freehold of the building) is also for sale, you can buy this too.

I have look on the Land reg site. The flat I want to buy only has the freehold title for download. There only seems to be one flat which has both freehold and leasehold titles available to download.

G_M

Hmmm. One of our tame solicitors will be along....

westv

Well I decided to see what the EA had to say. I got this reply.

"You are correct the flat is freehold however there are specific lenders out there who will mortgage freehold flats.

The interested party previous to yourself was a mortgage buyer and the mortgage was in place and proceeding fine without any problems."

The previous buyer had to pull out because their chain collapsed.

The question is, of course, is this list of "specific lenders" going to get smaller in the coming years?

Richard_Webster

Where is the flat?

If it is not in the Scarborough area (where Yorkshire BS and one or two others will lend, I think) then only RBS and Nat West will lend and they impose conditions which in practice are rarely capable of being complied with so you might as well forget it.

To comply withe conditions each time a flat changes hands you would have to get all the other 13 flat owners to enter into a deed of mutual covenant - can anyone honestly see them all doing that every time?

Just to be clear the freehold title that you have seen at the Land Registry is just for this flat and not for the whole building?

de1amo

My block is set up with a freehold company of me and the other 11 flat owners- the flat is infact leasehold with a 999 year lease--the block is run like a company in its own right and has to be registered and show accounts--it has a company secretary etc--its all done in house and when a person sells the freehold share goes into the new owners tenure

patman99

The name for that is 'Commonhold'. The flat I live in is the same. It is the responsibility of the managing company to set and collect service charges and arrange maintenance.

Richard_Webster

My block is set up with a freehold company of me and the other 11 flat owners- the flat is infact leasehold with a 999 year lease--the block is run like a company in its own right and has to be registered and show accounts--it has a company secretary etc--its all done in house and when a person sells the freehold share goes into the new owners tenure

The name for that is 'Commonhold'. The flat I live in is the same. It is the responsibility of the managing company to set and collect service charges and arrange maintenance.

No it isn't! It is simply a form of shared freehold with leases and the freehold owned by a company in turn owned by the lessees.

Commonhold was an attempt to provide a means of having freehold flats in England and Wales. Each flat has its own title and there is a separate title to the common areas owned by the Commonhold Association whose rules govern the payment of service charges etc. All the flat owners have to be long to the Commonhold Association which is a special kind of company.

Commonhold is not liked by developers because they lose the right to make some extra money by selling the freehold reversions in the block to property companies (some of whom are not very friendly). Conveyancing solicitors all went on courses about the new law when it came in a few years ago but very few of us have ever seen an actual commonhold - there are only a dozen or two commonholds in the whole country.

westv

de1amo wrote: »

My block is set up with a freehold company of me and the other 11 flat owners- the flat is infact leasehold with a 999 year lease--the block is run like a company in its own right and has to be registered and show accounts--it has a company secretary etc--its all done in house and when a person sells the freehold share goes into the new owners tenure

From what I have read and heard, that sounds exactly the situation for the flat I am interested in.