Extending a lease on flat - informal offer or s42?

jp1181

My gf has a flat with 74 years left on the lease that she rents out. We have decided to get on and get the lease extended so that should we come to sell it, we can.

We have read the info on the lease advice website, and contacted a couple of the specialists to request quotes for their work in managing the process.

They came back with a LOT of info, and not much of it that clear, so my question here is:

The ideal approach we would want to make is serving a s42 to the freeholder and getting the full 90yrs extension (and peppercorn ground rent) we are entitled to (i.e. extending the lease to 164years [74+90]). However, I understand this can be the more costly route and that some have had success with an 'informal' approach to the freeholder to purchase an extension to, say, 125 years.

Is there any downside to trying the informal route first, before then serving a s42 if the freeholder does make/accept reasonable offers?

tim123456789

No, that's exactly what you should do

jp1181

Ok, thanks for the response.

We have made a couple of initial enquiries with specialist lease extension solicitors, and are prepared to go down the formal route if need be, and they have recommended a valuer to approach.

My follow up question is - is there any point in getting a valuation (from a specialist lease ext valuer) before putting an informal approach to the freeholder?

Or should we only engage with a solicitor and valuer when (if...) we have an agreement on the lease extnesion cost and terms with the freeholder?

Thanks

tim123456789

no, it would be a waste of money if you have a reasonable LL who makes you a reasonable offer

tim

Leaseman_2

If you go down the informal route be prepared for the freeholder to come up with an offer that will be very much in their favour. There's a lot to be said for the formal route as it sets time deadlines and has a fixed route to resolution. Either way you should use a valuer and a solicitor experienced in such work.

jp1181

Update...

We informally asked the freeholder (Seager & Hughes) for an offer to extend the lease and they have replied as below:

In order to ascertain the cost of extending your Lease a valuation will need to be carried out by a surveyor.
We use Balcombe Associates who will carry out a table top valuation and the cost would be £350 plus vat.
If you would like to proceed please send a cheque for £420.00 either made payable to Balcombe Associates or ourselves and we will instruct the valuation.


- We're not sure what to do now, should we go ahead and pay? Do we need to get another surveyor to do a valuation to compare?

- what is 'table top valuation' as opposed to any other type?

- is this the time to serve an s42 and go down the formal route?

jp1181

Balcombe are on the ALEP website, so should be decent I presume, but wondering if we want an independent surveyor, as don't know their relationship to the freeholder (S&H).

Do we have to use their surveyor to value the lease?

advice gratefully received!

Fire_Fox

You have to dance to their tune because you've chosen the informal route.

jp1181

Fire_Fox wrote: »

You have to dance to their tune because you've chosen the informal route.

What do you mean exactly? Do you mean we MUSt use their surveyor? Do you mean now we have made an informal approach we can't move to a formal s42?

We had a quote two years ago from S&H that didn't require a surveyor, should we point to that?

richardw

Have thorough read of http://www.moneysavingexpert.com/mortgages/extend-your-lease

And https://forums.moneysavingexpert.com/discussion/3825027 there's lots of info that'll help with what can be a minefield

Fire_Fox

jimmiepreston wrote: »

What do you mean exactly? Do you mean we MUSt use their surveyor? Do you mean now we have made an informal approach we can't move to a formal s42?

We had a quote two years ago from S&H that didn't require a surveyor, should we point to that?

I mean what I said. If you choose the statutory route, the legislation guides the freeholder. If you choose the informal route, the freeholder calls all the shots. You can certainly move onto the statutory route now if you choose.

If you were going to point to an old quote the time to do that would have been when you made your initial approach, but that is two years out of date now anyway. S&H have been quite clear what they want, you can try to negotiate but see Leaseman's earlier post.