Buying out ground rent

dmxdave

saverbuyer wrote: »

You need to speak to better solicitor. Really poor advice there.

Its a very simple process. Well worth it even for £6.50.

saverbuyer wrote: »

Depends if there are restrictive covenants or not. £120 quid could be worth it if you plan on building an extension or doing something prohibited in the lease.

You did not mention that before.

saverbuyer

dmxdave wrote: »

You did not mention that before.

I would say 130 is very cheap for a freehold. 20 years payments at current levels. It's probably inflation linked. The only reason I wouldn't buy it out is if it was peppercorn.

RikM

I thought that buying out the lease did *not* relieve covenants, they would still apply.

Artytarty

That is quite correct.

martin57

Ground rent in my opinions is a total rip off and even worse some people even shrug their shoulders and laugh and say "I wont pay it"

A bad idea, technically speaking if you pay ground rent and you miss a few years, you can be taken to court and in the worse cases you can even loose your house, because ground rent is in fact the charge for you to lease the land that the house stands on from the freeholder. You don't pay the ground rent, he can reclaim his land, simple as that! with your house on it.

After moving into my present property which had ground rent of £30 per year, I was given the run around by a cunning freeholder sending me a bill for over £200 saying that ground rent wasn't paid. It was, and I let him know that should he continue to harass me he would be taken to court, he denied it all of course blamed it on an employee.

The truth of the matter is in my opinion if you have ground rent on your property and you don't buy it out, then the freeholder or his agent had a stranglehold on you, and you can't sleep soundly in your bed, because no matter what your house cost, someone else has a say in who owns it i.e if you don't pay or happen to miss a ground rent payment you could get a threatening letter about going to court and even loosing your home. I did get one of these myself a few years down the line as I wasn't on time with my ground rent payment.

I bought mine out a few years ago overall cost near £600 but when I was at it I got the freehold as well, though as stated above the covenants in the lease still stand.

I feel very strongly about this and feel sorry for a lot of people who simply stick their heads in the sand as regards ground rent, and don't realise that their home could be at risk.

I know some won't agree with me but buying it out makes me feel a lot more relaxed about owning my house.

Martin57

warmhands.coldheart

I bought a house just under 2 years ago now and it had a Fee Farm Grant on it (Don't ask but I think it pre-dates Leasehold)
Anyway, I think we are to pay £6.50 to some company but I have no idea who. is it up to me to go back and find this out or is it a case they should be in contact to look for the money (i.e. invoice me) ?????

seems to me if they want the money they should come ask for it!! what should I do????

GlynD

warmhands.coldheart wrote: »

I bought a house just under 2 years ago now and it had a Fee Farm Grant on it (Don't ask but I think it pre-dates Leasehold)
Anyway, I think we are to pay £6.50 to some company but I have no idea who. is it up to me to go back and find this out or is it a case they should be in contact to look for the money (i.e. invoice me) ?????

seems to me if they want the money they should come ask for it!! what should I do????

In English and Irish law, a Fee farm grant is a hybrid type of land ownership typical in cities and towns. The word "fee" is derived from fief, meaning a feudal landholding, and a fee farm grant is similar to a fee simple in the sense that it gives the grantee the right to hold a freehold estate, the only difference being the payment of an annual rent (farm being an archaic word for rent) and covenants, thus putting both parties in a landlord-tenant relationship.

http://en.wikipedia.org/wiki/Fee_farm_grant

I thought it might be similar to the Scottish Feuhold but it's not. That's more like our freehold only more absolute.

In any case, because the OP's ground rent is only £6.50 a year I'd say go for it. It's a pittance for a little more peace of mind and it may make the property just a little more easy to sell because it'll be freehold.

martin57

GlynD wrote: »

In English and Irish law, a Fee farm grant is a hybrid type of land ownership typical in cities and towns. The word "fee" is derived from fief, meaning a feudal landholding, and a fee farm grant is similar to a fee simple in the sense that it gives the grantee the right to hold a freehold estate, the only difference being the payment of an annual rent (farm being an archaic word for rent) and covenants, thus putting both parties in a landlord-tenant relationship.

http://en.wikipedia.org/wiki/Fee_farm_grant

I thought it might be similar to the Scottish Feuhold but it's not. That's more like our freehold only more absolute.

In any case, because the OP's ground rent is only £6.50 a year I'd say go for it. It's a pittance for a little more peace of mind and it may make the property just a little more easy to sell because it'll be freehold.

As far as I am aware buying out the ground rent doesn't give you the freehold (that is a separate matter altogether with its own fees to the land registry)

Buying out ground rent only entitles you to not having to pay any for the remainder term of the lease which still remains in place.

So its a good idea to go for the freehold as well though this will involve extra fees.

Martin57

GlynD

martin57 wrote: »

As far as I am aware buying out the ground rent doesn't give you the freehold (that is a separate matter altogether with its own fees to the land registry)

Buying out ground rent only entitles you to not having to pay any for the remainder term of the lease which still remains in place.

So its a good idea to go for the freehold as well though this will involve extra fees.

Martin57

More education for me. Thank you Martin. As a result of this I've now been able to track down the relevant legislation and it's surprisingly modern. The Ground Rents Act (Northern Ireland) 2001. It might be of some use to the OP and others.

http://www.legislation.gov.uk/nia/2001/5/contents

warmhands.coldheart

GlynD wrote: »

In English and Irish law, a Fee farm grant is a hybrid type of land ownership typical in cities and towns. The word "fee" is derived from fief, meaning a feudal landholding, and a fee farm grant is similar to a fee simple in the sense that it gives the grantee the right to hold a freehold estate, the only difference being the payment of an annual rent (farm being an archaic word for rent) and covenants, thus putting both parties in a landlord-tenant relationship.

http://en.wikipedia.org/wiki/Fee_farm_grant....

Yeah read that!! still clear as mud!!!! :rotfl: