Paying Management Pack for Vendor

earlgrey13

I am in the process of purchasing a flat. Today the agent called up and told me that the vendor cannot afford to pay for the management pack and expects me to pay for him (and will refund on completion). Could you please let me know your thoughts of the situation and if you have seen such circumstances before? Anything I need to be aware? Obviously, if I pay the management pack for the vendor, the deal does not go through in the end (him pulling out, search report or bank valuation have issues etc.), I will have to take the loss…

please kindly let me know - eager to hear your advices and suggestions.

thanks in advance.

earlgrey13

any advices are appreciated!

ChumpusRex

It's a pretty cheeky request.

That said, management packs aren't anything special, and should be documents any flat owner should already have to hand (A copy of the lease, minutes of the last management compnay meeting, copy of the accounts, receipts for the service charge and ground rent).

They are usually given out free on request, or for a nominal fee - e.g. £25.

There are some investemnt firms specialising in leasehold managment. These will charge the maximum they can get away with for everything - £500 for a management pack, £50 for a copy of an invoice, £150 for permission to replace your boiler, £150 for permission to change laminate flooring to wood, £500 admin fee for claiming on the block buildings insurance, etc. Obviously a management company like this can add significant extra running costs to your home.

It is a very odd request for the vendor to make, because it gives the impression that he is in severe financial difficulty and desperate to sell ASAP. If you were that way inclined, you could take advantage of the desperateness to sell by reducing your offer or threatening to pull out of the deal.

earlgrey13

ChumpusRex wrote: »

It's a pretty cheeky request.

That said, management packs aren't anything special, and should be documents any flat owner should already have to hand (A copy of the lease, minutes of the last management compnay meeting, copy of the accounts, receipts for the service charge and ground rent).

They are usually given out free on request, or for a nominal fee - e.g. £25.

There are some investemnt firms specialising in leasehold managment. These will charge the maximum they can get away with for everything - £500 for a management pack, £50 for a copy of an invoice, £150 for permission to replace your boiler, £150 for permission to change laminate flooring to wood, £500 admin fee for claiming on the block buildings insurance, etc. Obviously a management company like this can add significant extra running costs to your home.

It is a very odd request for the vendor to make, because it gives the impression that he is in severe financial difficulty and desperate to sell ASAP. If you were that way inclined, you could take advantage of the desperateness to sell by reducing your offer or threatening to pull out of the deal.

Dear ChumpusRex,

Thank you so much for getting back to me! I was not aware either that the vendor is in such stressed situation.

However, the deal price is indeed slightly lower than market price (about 5%). I do not want to lose the deal either as I have paid some upfront such as mortgage arrangement fees, valuation fees, and solicitor upfront fees.

I am just slightly worried as the vendor seems so financially distressed...and I have never had such experiences dealing with such vendors before. That's why I come to this forum asking for advices.

Many thanks for your advices.

earlgrey13

ChumpusRex wrote: »

It's a pretty cheeky request.

That said, management packs aren't anything special, and should be documents any flat owner should already have to hand (A copy of the lease, minutes of the last management compnay meeting, copy of the accounts, receipts for the service charge and ground rent).

They are usually given out free on request, or for a nominal fee - e.g. £25.

There are some investemnt firms specialising in leasehold managment. These will charge the maximum they can get away with for everything - £500 for a management pack, £50 for a copy of an invoice, £150 for permission to replace your boiler, £150 for permission to change laminate flooring to wood, £500 admin fee for claiming on the block buildings insurance, etc. Obviously a management company like this can add significant extra running costs to your home.

It is a very odd request for the vendor to make, because it gives the impression that he is in severe financial difficulty and desperate to sell ASAP. If you were that way inclined, you could take advantage of the desperateness to sell by reducing your offer or threatening to pull out of the deal.

and the management pack will cost 400 pounds...the vendor's solicitor will contact my solicitor to have that paid...and once complete, my solicitor will deduct that payment off my bill.

Hashbrown_2

It's cheeky and the correct answer is that they have should be made to pay it.

But, that being said, in the grand scheme of things, as long as the solicitors thrash something out that says you'll get the money back, regardless of whether the sale completes or not, I'll just be inclined to pay it.

He'll only disagree to that clause if he isn't serious about selling...

earlgrey13

Hashbrown wrote: »

It's cheeky and the correct answer is that they have should be made to pay it.

But, that being said, in the grand scheme of things, as long as the solicitors thrash something out that says you'll get the money back, regardless of whether the sale completes or not, I'll just be inclined to pay it.

He'll only disagree to that clause if he isn't serious about selling...

thanks a lot for your advices, Hashbrown!

propertyman

ChumpusRex wrote: »

It's a pretty cheeky request.

.

what pasting at 9.32 and chasing a reply 30 minutes later


In fact in most cases it is the purchaser who pays for the information and makes the request as they have particular questions and issues in mind, rather than the vendor.

If he is happy pay for it embrace the offer and take it !

hazyjo

I'd suggest their EA pays it and knocks it off their bill at the end. If they're so sure nothing will go wrong, let it be their problem - not yours.


As you say, if it falls though, you're out of pocket and they have a free pack.


Jx

nicegirl

I think it's really cheeky of them to ask you to pay! Especially as it's not exactly a small sum of money. I know that you'll get it back, but still.

We just sold our flat and we paid for the management pack. Ours was only £54 though.

vw100

If he wants you to pay, and will deduct the difference at completion, then it appears ok, especially if you getting a good deal on the purchase and you want the property. Also it will save some delay. I know a friend who sold his flat and had to pay around £400 inc VAT for the management pack. Also the management pack has a expiry date and is only valid for around 2 months I think. After that a new up to date management pack is requested as it will contain up to date accounts, statements etc.

The buyers solictors did not want individual statements etc, and insisted on the management pack to proceed with the transaction.