Freeholder preventing remortgage - what can I do?

marcosscriven

Hi all

Wonder if anyone can advise on the following:

- I am currently trying to remortgage my maisonette.

- I've been stuck on a fixed rate of 5.69%, but the lender waived the early repayment charge back in December.

- I was offered a new mortgage at 3.69%, which would save me £1000 a month. Everything was approved, and sent to the conveyancing stage.

- The freeholder is refusing to provide a 'notice of receipt' for the change of lender, and is claiming I owe him money.

- I have a recent Leasehold Valuation Tribunal decision stating that not only do I owe the freeholder nothing, he owes me £250 costs. (Awarded by the LVT to me, as he didn't even turn up)

I spoke to the Leashold Advisory Service, and they said they weren't sure if anything could be done.

The mortgage provider's solicitors have confirmed this is the only thing holding up my new mortgage (since December), so already I'm £2k out of pocket, plus solicitors fees. They say that while they understand the LVT decision, their security is at risk if they don't receive notice from the freeholder.

I cannot enfranchise the freehold, as I represent only 50% of the leaseholders, and the other leaseholder is the freeholder himself.

My solicitor suggests that I may be able to seek a county court judgement, if I can show I've lost out, but that the freeholder is unlikely to pay (he's an international businessman, based well outside the UK and Europe).

I really don't know what to do? There appears to be no remedy in the law for me? I can't force a mortgage provider to give me a mortgage, I can't force the freeholder to write a notice of receipt.

I've tried writing to the housing minister, and my local MP, to no avail.

Hoping someone can come up with a brain wave!

Marcos

Richard_Webster

Mortgage lender wants to be sure freeholder knows about its existence so they get told if he is thinking of taking steps to forfeit the lease.

If it can be proved that the notice has been served on the freeholder, the fact that he won't receipt it is nothing to do with anything.

I suspect the greater issue is that he is alleging you owe him money and lender wants to make sure that he accepts that you don't.

propertyman

First things first, does the lease actually require service of a notice of mortgage or charge? While common, there are common omissions, and I can bet that 1 times of out 2, the lenders Solicitor hasn't checked...

Secondly any invoice for rent or service charge must contain a notice under section 47 & 48 of the landlord and tenant act 1987 saying the landlord is X and the address for service of notices including proceedings in England and Wales is Y.

You can then serve notice at that address ideally by a process server who will provide a declaration or afadavit that the notice was served "on and at".

If he has not provided that address then use the one that you have as above.

That should satisfy the lender and if not escalate it within their department.

Ask the question " if its is a question of him not knowing of your existence, are you not going to register the mortgage on the charges register at HMLR then".....

Richard_Webster

First things first, does the lease actually require service of a notice of mortgage or charge? While common, there are common omissions, and I can bet that 1 times of out 2, the lenders Solicitor hasn't checked...

Yes, but the CML Handbook requires service on the freeholder whether or not required by the lease...

Lenders can be quite frustrating on this kind of thing. I had clients buying the residue of 1000 year lease from 1856 with some paltry annual ground rent and the identity of the freeholder not known. We wrote to First Direct telling them this and suggesting indemnity policies to keep them happy and now having had the deeds they want a notice of assignment receipted by the landlord....!!!

Catti

Am I misunderstanding something here? As notice would ordinarily be given After completion, it seems to me that it's not the notice that we are talking about, but the requirement for a clear rent/service charge account before the mortgage completes. The puts a different angle on how it can proceed.

Richard_Webster

Am I misunderstanding something here? As notice would ordinarily be given After completion, it seems to me that it's not the notice that we are talking about, but the requirement for a clear rent/service charge account before the mortgage completes. The puts a different angle on how it can proceed.

Yes, I thought that was a bit odd - but frankly the way some mortgagee's solicitors behave nothing would surprise me!

propertyman

Richard_Webster wrote: »

Yes, but the CML Handbook requires service on the freeholder whether or not required by the lease...

Ah no you misunderstand. Service of Notice is one thing, it is the refusal that is the crux, and that operates on the wording of the lease.

The lender cannot compel the landlord to receipt, only the lease can, and then only if specifically binding between them.

Like you I have had experience of this with tripartate's and RTM's, and eventually the Lender gets the message.

propertyman

While the drafting is complicated it is possible to have the court accept the notice once the issues of the arrears are clarified or determined. Similarly you claim damages

All of which takes time. But if followed through and he fails to appear or respond to a summons for settlement hearings then you can ask for a warrant to be issued and he might then be nabbed at some point.


But there is hope if as you say he is based abroad if none of his invoices to date include a notice giving his address in England and Wales for service of Notice, and, with service charges the summary of rights, and for rent the section 166 notice, then the sums alleged aren't due and therefore a court might be persuaded to direct him to receipt or do so in his absence.

If there are other breaches you are best to look at apponting an independent manager at the LVT and inculde in that award the obligation to collect rent and account to the freeholder.

Or consider extending the lease under section 42, again the court will act in his absence and the rent becomes a peppercorn.

That's the most brainwave I can generate this late:)