Lease on contract is shorter than when it was advertised... What to do?

Phil000

Thanks again for the replies.

@AdrianC - the building is a victorian house that used to be divided into a flat upstairs and shop downstairs. The vendor bought the whole thing, and he is the freeholder, converted the 2 floors into 2 flats and put them on the market. I'm not sure how it works, if at present times he is also the leaseholder of the 2 different flats, as to be honest this whole freeholder/leaseholder things still makes little sense to me (I'm not British)

@Hoploz - both flats were on the market when my offer was accepted, last time I enquired with the EA about the situation with the flat below they told me that they are exchanging contracts on that too these days. So probably you're right, the vendors are still quite disorganised. So the question would be: do I need to get them to agree on all this points before exchanging? Should they revise their paperwork and resend before me signing anything?

Thanks!

HouseBuyer77

As the vendor is the freeholder I'd say they're after a tidy profit. They're hoping to sell the flats with high ground rents and maybe some shenanigans on the service charge front (service charge has to go towards insurance/maintenance not towards freeholder, but you can set up shady scheme where the freehold employs companies they own to do things).

I'd certainly try to negoiate with the vendor (with their freeholder hat on) for a longer lease/cheaper ground rent.

Proceed with caution.

Hoploz

Phil000 wrote: »

So the question would be: do I need to get them to agree on all this points before exchanging? Should they revise their paperwork and resend before me signing anything?

Thanks!

It's really up to you. realistically if it's a small building with two flats there prob isn't much in the way of weekly cleaning. Maybe a bit of gardening? So the service charges are not likely to be a fortune.

You must get the lease length and costs clarified to a point that you're happy with. Ask for the longest lease they're prepared to do, with the lowest ground rent they will accept. It may or may not have been drawn up yet.

Assuming ithas been renovated to a good standard there shouldn't be much in the way of maintenance and repairs in the next few years so there's no reason the ongoing charges should be a lot. But you have to at least get an estimate, I'd have thought. It's only fair that they give you this. How can you be expected to proceed without knowing the cost implications?

Phil000

I literally just received a call from the EA, saying that the vendor now is !!!!ed off because he has sent all information about the lease length and ground rent over 2 months ago to my solicitors - but again I only received the reports and documentation now! If that is true, should I get mad at my solicitor for keeping me off the loop? Was it his responsibilities to notify me back then, or is it standard that all these information come through with the reports at the end?

I'm really confused because the EA keeps telling me that I really need to hurry up exchanging because they put the flat back on the market and they are receiving higher offers, but I really don't understand how can I speed this process up since I received the information only now, and some of them are so unsatisfactory. This behaviour alone, this constant being pushed around, makes me want to pull out and not give my money to this people - but then again I'm trying to stay rational, keep calm and carry on

The EA was advicing we'd exchange on a 'conditional basis' that they provide me a satisfactory service charge figure before completion, and if they fail and it's too much then it's on them. But then again, what does 'satisfactory' means? Worst thing is my solicitors haven't been answering my enquiries around all this since last Wednesday. I'll definitely need an holiday after all this is finished! (except I'll be too broke for that! :P)

AlexMac

Phil000 wrote: »

I literally just received a call from the EA, saying that the vendor now is !!!!ed off ...should I get mad at my solicitor for keeping me off the loop? ...the EA keeps telling me that I really need to hurry up exchanging because they put the flat back on the market and they are receiving higher offers.... I'll definitely need an holiday after all this is finished! (except I'll be too broke for that! :P)

Don't panic, but don't be pushed around, and as everyone says, don'y believe a word the EA says.
don't blame your solicitor, even though they may not be serving you well- try to chat to them about your concerns (not on a Friday afternoon however) and tell 'em you expect help sorting your concerns. I assume that they have not yet fully reported to you, and yes, thay probably prefer to do this in one hit at the end, but the reason they've shown you some paperwork (?) is to check you're happy with it.

Marshall your concerns, some of which are

- the lease is shorter than promised
- the Ground rent is very high (usually it's a token sum; I've never paid over £10 pa)
- the unspecified service charge is wholly unacceptable-

I don't share hoploz's optimism that the freeholder can't overcharge you for services. I pay £450 p.a services on a 1 bed flat, £600 pa on a 2 bedder, but friends in a 3 bed place with a rip-off freeholder, pay an eye watering £3-4k pa.

When I bought the freehold of a 2-flat Victorian conversion and sold it a few years later, my Chartered surveyor mate told me to sell on the freehold, as it would be more trouble than its worth to organise insurance, maintenance, communal electricity, asbestos surveys, etc. Why is the developer retaining the freehold on such a small property other than to rake in admin fees, toppy ground rent, rake-off on repeirs and future lease extension fees? (A much better arrangement would be a shared freehold by you and whoever buys the other flat- failing that, talk them into going for Right to Manage after you buy).

Anyway- I'm sure it will be OK- but if you do end up walking away, look for a shared freehold or a less tricky freeholder next time - but it will be ok- the EA's BS'tting about other buyers

AdrianC

First off, ignore the EA. They are paid by the vendor to sell the property. They are not your friends, and they are not trying to help you.

Your solicitor needs to extract digit, but he is the only one in this who is looking out for your corner.

marksoton

Phil000 wrote: »

The EA was advicing we'd exchange on a 'conditional basis' that they provide me a satisfactory service charge figure before completion, and if they fail and it's too much then it's on them. But then again, what does 'satisfactory' means?

You bloody what!?

So they're going to pay the excessive service charge for all eternity are they? Do me a favour...

You seriously need to stop listening to this clown....