Missing Lease and other troubles

pandarabbit

Hmmm... yeah. I guess I have not considered what would happen if their seller were to pull out.

To give a bit more information, the flat we are attempting to buy was not the seller's residence, it was a rental property (which has not been tennated since its been on the market). I guess my assumption was that maybe if their seller doesnt pull out, then we might be in a strong(ish) position because if we pull out, they lose thier new purchase and are stuck with an empty flat to maintain and re-market.

In terms of the granting a new lease / getting an extension out of it, I was more thinking that the seller sorts this out with the freeholder before we complete. My thoughts were if they can do this informally then maybe it won't cause such a hold up... but in all honesty this is just my speculation.

So that leads me here... what do I want out of this AND what is reasonable to ask of the seller... bearing in mind we don't want to be difficult, we just want to protect our interests...

(Oh, and this assumes we can get a version of the lease the LR and our Lender will accept)

1. We want to purchase a flat with 86 years (min.) left on the lease and service charges not exceeding £600pa - for the price we offered £175,00.... Well we know this is now impossible because that deal is no longer on the table... so...

2. We want to purchase a flat with a new 99 year lease and will absorb the £1300pa service charges and accept exsiting lease terms... but out offer must remain at £175,00 and the seller must bear the costs of sorting this out. OR...

3. We accept that there are only 84 years remaining and will have to extend in 2 years time for costs of £5-10k(including fees). We accept the increase in service charges (£700pa more than expected). However we reduce our offer to account for the fact in 2 years time (and to have a chance of selling in under 5 years) we will be £6.4-11.4K down (potentially) .... we reduce our offer to £165.00 say... OR

4. We walk away. No flat and time and money down the drain

I guess my question is does anyone think its worth exploring 2 or 3... before we plump for number 4 and everyone ends up dissapointed?

Worth also saying, whilst the seller is in a chain we have no chain and are not in a hurry so can afford some time to sort...

AdrianC

When you say "service charges", what do they include? Sinking fund?

pandarabbit

Service charge includes: Monthly maintance charge, a magagement fee (for the freeholder - theres no agent. He has set the charge to 20% of the manitance fee) and I did also lump the ground rent in there (so thats £20pa)... takes it to roughly £1300pa

There is a term stating the lessor may create a 'reasonable reserve fund' for future maintanance, decoration and repair of £50 per half year. As far as I am aware the freeholder has not done this to date.

We would also be responsible for 50% of charges to repair the buildings structure (i..e. walls, gutters, chimneys, roof etc) ... although I guess this is fairly typical in the leasehold scenario?

pandarabbit

If there is anything I have learned from this is get a good solicitor! Our's has been great ... but the seller's has been absolutely AWFUL.

We have been waiting for two days to get the 'new/correct' documents for them to send us the exact same stuff... rubbish...