Management Company Refurbishment - Cash Call

konn1ch1ha

Hello all,

I'm not sure if I'm in the right corner of MSE or not, so please redirect me if there is a more appropriate forum for this question.

So myself and six other shareholders all own the management company of a building in Brighton. The building consists of six flats and a basement flat (my share in the management company, I believe, is 4%), the others have some at 12, 15% etc etc.

There are a lot of works to be done throughout the building, such as exterior rendering, possible removal of fire escape and roofing amongst many other issues to be addressed, as well as the erecting of scaffolding to the front and rear of the building. The total is around the price of £43k (including property management fees VAT etc). I would pay 4% of this, being about £1700.

However, what happens when the cash-call is made? I'm not in a position to pay that share straight up. Would the bank be willing to lend me the money (on top of my already existing overdraft) on the strength I do not have a mortgage and it's an investment? What arrangements could be made?

Any advice or information on the situation would be much appreciated.

Thanks

southcoastrgi

How is the monthly maintainence charged worked out then does the person who has 12% pay 3 times more per month than you ?

konn1ch1ha

southcoastrgi wrote: »

How is the monthly maintainence charged worked out then does the person who has 12% pay 3 times more per month than you ?

I believe we all pay the same amount every quarterly.

southcoastrgi

Then you all should have equal shares I'm not sure how some have more of a percentage or how you are paying less for the repairs unless they are taking money out of the company

vansboy

The flat I have just sold was owning part of the freehold, all equally.

The residents were also the management company and wjhen I bought it, there had been a loan from Barclays, which they had allowed to roll on, rather than pay off, just in case something like what you are experiencing needed doing. Easir to just extend and increase rather than apply again.

There wouldn't be any dificulty for your company to source a similar loan, I'd think.

VB