Ground rent company charging us £100 to change mortgage lender

lil_jellyfish

Hi everyone

Just wondered if this is the norm and if we can avoid it again in the future.

We've had our current house 3 years and we've come to the end of the fixed rate on the mortgage so shopped around for the best deal. The solicitor needed a copy of ID, utility bill and receipt of ground rent. We don't get receipts or invoices from the ground rent co so I emailed them as they won't give us their phone number.

They oddly told me to print our email convo as proof as they don't give receipts, and warned us that £100 charges will incur if we ever change mortgage company. We plan to change to the best rate we can every 2 or 3 years so I wasn't impressed.
Anyway I thought I was being clever, I printed the email to give to the solicitor and emailed back saying thanks for the advice but we've decided against changing the mortgage (thinking we'd avoid the charges because they'd think we didn't go ahead!)
Now we've had an email from the ground rent company, they know from the solicitor that we've changed mortgage and are charging £100.

Is there anyway of avoiding this in the future?

Thanks

propertyman

Yes and no. Notice has to be given only if the lease requires it to be given, and that may require a fee which might be stated in the lease.

So pull out the lease.

If the fee is worded as reasonable or similar wording, then the law protects you by allowing admin fees in a lease to be challenged at the LVT, and typically are awarded @ £35 to £50. Now the Act seems to exclude such notifcations but that hasn't stopped some LVT panels ruling on them!

Now to make you feel better irrespective of what it says in the lease you do not have to pay ground rent undless it is demanded with the name and address of the landlord under section 47 and 48 of the landlord and tenant act 1987, and it must be accompanied with notice under section 166 Commonhold Leasehold Reform Act 2002.

Failure to do so means that you do not have to pay it.
http://www.legislation.gov.uk/ukpga/1987/31/section/47

http://www.lease-advice.org/publications/documents/document.asp?item=14#28

Fire_Fox

Where are you in the UK? Is this a leasehold property, if so do you mean the freeholder? Read the long lease to see what charges are applicable - if you are in England or Wales you should be getting invoices and annual statements of accounts as a matter of course.

lil_jellyfish

We're in St Helens, Merseyside and i also thought we should be getting invoices.
Sorry, yes i meant the lease holder...the person we pay the ground rent to.

Thanks very much for the info, I'll get the lease out and have a good read then go from there.

Thanks again

Richard_Webster

Sorry, yes i meant the lease holder...the person we pay the ground rent to.

You are the leaseholder - you pay the ground rent to the freeholder.

Keswicksprings

I have a similar question I own a leasehold property which I bought outright 5 yrs ago the previous owners had never paid ground rent a neither have we no one knew who to contact regarding it. I have just received a letter addressed to the Occupier from a solicitor acting on behalf of executors of the leaseholder offering to sell me the freehold for £495 we are not allowed to negotiate or contact them other to return the forms and money by Dec all offers of sale will be refused after this date. If I choose not to buy they say the executors will sell respective leaseholds to a professional ground rent company who could then choose to enforce the existing covenants in respect of any extensions etc carried out on property (this has been done before we bought it) Could anyone tell me where I stand on this an if it is sold to another company could they put my ground rent up and where do I stand as far as I am aware no one in the street can ever remember paying ground rent for many yrs.

jayship

Keswicksprings
To buy the freehold it would require all leaseholders in the block agree to purchase. Leaseholders have the first right of refusal after which the freeholder may offer it to other interested parties. I have been to a few auctions and there are many ground rents for sale. My friend owned a flat in a block of 10 and they all agreed to buy the freehold. Hence all owners are now responsible for the upkeep and maintenance of the block.
There will be others on the forum with experience and advice.

Fire_Fox

Keswicksprings wrote: »

I have a similar question I own a leasehold property which I bought outright 5 yrs ago the previous owners had never paid ground rent a neither have we no one knew who to contact regarding it. I have just received a letter addressed to the Occupier from a solicitor acting on behalf of executors of the leaseholder offering to sell me the freehold for £495 we are not allowed to negotiate or contact them other to return the forms and money by Dec all offers of sale will be refused after this date. If I choose not to buy they say the executors will sell respective leaseholds to a professional ground rent company who could then choose to enforce the existing covenants in respect of any extensions etc carried out on property (this has been done before we bought it) Could anyone tell me where I stand on this an if it is sold to another company could they put my ground rent up and where do I stand as far as I am aware no one in the street can ever remember paying ground rent for many yrs.

Welcome! It's well worth reading the LEASE website already linked to alongside the paperwork you have just received.

propertyman

No, you are the leaseholder- you own a lease of that property, they act for the freeholder.

They are not offering you the freehold of your property*, you will always have a lease, but the freehold of the land on which it is built and that normally includes the structure and common parts of the building, tu purchase as a group.

There is no negotiation as they are only required to set a price, ready to sell to a known buyer, and then offer it the leaseholder's first.

* If you have a house then the rules are different and they are not required to offer it to you first, and may just be doing so as they expect a considerable uptake from the house owner who frankly are the most likley buyers in most cases.