Service Charge Help!

177london

Hi

I am in a tricky situation, have just got divorced and am waiting for my financial settlement to come through.. its not much but enough to pay off my debt, that is if my ex husband pays it! I have a court order for the finances but it cant be enforced until he fails to pay which he has 6months to do..

Problem is I have a property that I let out and I have fallen behind on my service charges.. I have struggled to pay them for the last 3 years as i have a young child and my ex does not always pay his maintenace.. Last October I paid off 1000 pounds but today they have written to me saying unless I pay off the remanding which is 1300 less their ridiculous charges within 4 days they will seek court proceedings under the county courts act..

I have written to explain my situation and to state i can only afford 50 pounds a month until this money comes through..

Am at a loss as just dont know what i can do any help appreciated!

Thanks

Owain_Moneysaver

They will probably issue a court summons. That might take their solicitors and the court a couple of weeks.

You'll have to respond in writing to that within a certain date.

Then it will go to court. That may take more than a month for a court hearing.

If you can show to the court that the non-payment is not down to you and that you can afford £50 a month then the court will probably order you to pay £50 a month. (There will be interest on top of that, the rate is laid down in law.) However if you are getting rental income the court might expect that to be paid towards the mortgage and the service charges first, so be prepared to show what you're spending the rental income on instead.

177london

Hi

The rental income dosnt cover the mortgage there is a shortfall of 100 pounds that I have to make up..

If It goes to court do I end up with a CCJ then??

Thanks

BitterAndTwisted

Yes, you will. And the outstanding S/C will in all likelihood result in a charge being attached to the property. If there's a shortfall of £100 a month against the mortgage payments, leaving nothing to pay the S/C with I suggest that you sell up asap. How are you managing to pay the tax owed on the rental-income?

Werdnal

Sorry to hear of your situation, but seriously, if you are running a letting property on such a tight financial situation, how would you manage if there was a major repair issue with the property - burst pipe leading to flood, boiler breakdown etc? You couldn't simply tell the tenant you haven't got the money to repair and if the place was uninhabitable due to damage, you would have to fund alternative accomodation until it was put right.

I too would consider selling up asap, before you really get into difficulty!

G_M

If your business is running at a loss, then either restructure or sell the business.

Clearly your rental income is insufficient to cover orverheads, income tax, service charge, mortgage (if any) etc.

So either re-mortgage, or cut costs (are you using an agent? DIY managing will save 10-12%). If none of this works, then the business is not viable. Sell as a going concern to another landlord, or evict the tenant and sell on the open market.