Covenant on House - Expensive extras added at last minute?

shauna4419

Hi all,

Not really sure what to title this but basically, we are in the process of buying ( FTB - exchange today or tomorrow, hopefully). and just found out on Saturday after an enquiry from our Solicitor that the house is subject to a covenant for a maintenance of a 'garden' area (grass and shrubs).

Their contract covers a small area of grass at the back of the housing, and it states that no dogs are allowed on the area (the only reason we may use it!), and that we can be fined if someone reports us walking our dog on the grass. Same with ball games. Worryingly, the contract also states that they can increase the price whenever such they like, and they can charge us for any work that isn't already paid for with the money that they take. Last year, our seller paid £70 and this year it's £120 - so clearly they can jump quite rapidly. Anyway, we understand it's got to be done so we told our solicitor we were OK with it.

However, now we have today been sent a document which states that in order to exchange, we need to pay this grass cutting firm (greenbelt) £200 in admin fees. So, we have to agree to their terms and pay the money before we can exchange, and there's really no way around any of it.

Further than this, our seller has been in touch stating that they have sent her a final bill - she needs to pay the sum up to November, they say, despite her not living there anymore. They are, however, starting our bill from this month (June) and we are expected to pay this month as well - so effectively they have two lots of money for one house, and they are charging us an extra £200 as an admin fee.

Our solicitor says the paperwork covers what they are doing, and there's no way around it. I understand that if we want the house we have to deal with this, but it has all been very last minute and for some they wouldn't have been able to find an extra £200 on the day of exchange!

Has anyone seen an admin fee this steep before? Has anyone had any experience with grass maintenance companies, and were you told about it earlier in the process?

AnotherJoe

I'd be very worried about the open ended commitment to pay whatever was required. Enough that I wouldn't buy and would pull out now.
This has been referred to before here when people, have even taken these companies to court on the grounds that the charges were clearly unfair and they lost and there's no way to rep,ace them with a resident chosen company or DIY either. . What happens if in five years time it's £2k to cut the lawn? Who would buy your house?

Freecall

From what you say the £200 is a one-off fee to cover the work associated with the transfer of ownership. Personally I think this is high but it probably does reflect the going rate.

The other fee which presumably is the annual service charge, should not be payed twice (ie firstly by the current owner and then again by you). It sounds as if the current owner will pay for the next 6 months and then receive a refund from you when you complete.

Remember, the maintenance company has no way of knowing that the house will be sold (actually if you have not yet exchanged, nor does anybody else for that matter, it could still fall through).

Your solicitor should work this out so that you each pay the appropriate portion for the period you own the property.

Rest assured that this whole process is perfectly normal and your solicitor will be completely familiar with it.

Enjoy your new home.

:beer:

Davesnave

This is very common on newer estates where someone has to look after the maintenance of common areas, now that councils won't.

It's obviously an open cheque if there really is no way of terminating the contract after a set period. In many, or even most cases, this company buys the communal areas, so sacking them isn't an option.

There have been many complaints about the Greenbelt Group; just Google it and you'll see what I mean.

dragonsoup

Seriously I wouldn't go ahead on these terms.

Having to pay a third party whatever they demand with no cap would be a complete and utter deal breaker.

Brock_and_Roll

Frankly clauses like that exploit the naivety of buyers along with their reluctance to walk away from a property where they have already made financial and emotional commitments.


In any other walk of personal or business life, no one of sane mind would dream of signing such an open ended commitment and this should be no different.

moneyistooshorttomention

I wouldnt be happy either at having an unexpected expense sprung on me like that.

The thing that would worry me most would be nothing in writing specifying what the position would be re annual "inflation rises". If there wasnt even something saying "The annual rises will be set at RPI or CPI level each year" then you could find that the RPI, for instance, was 2% in the previous year - but they have decided to up your annual bill by 3%, 4%, 5%, who knows what %:eek:.

People/firms can often not resist the temptation to get in a "real rise" as well as what inflation dictates when it comes to it and will find some excuse or other to try and justify it.

unforeseen

I would be tempted to find a solicitor who is experienced in property law. rather than the general solicitor doing conveyancing which is what you have.

I fail to see how a positive covenant would be binding on you unless you agree which you would be a fool to do.

Freecall

moneyistooshorttomention wrote: »

The thing that would worry me most would be nothing in writing specifying what the position would be re annual "inflation rises".

There seems to be a major misunderstanding here. There will be something in writing (otherwise there would be nothing to bill against) and usually this is incorporated as part of the Deed of Transfer although there are other ways of doing it.

This will specify what area of land is to be used and maintained, what the maintenance work will include (cutting the grass in this case but probably other stuff as well, almost certainly insurance), and how this will be paid for. The concept of 'inflation rises' does not really exist as nobody can know in advance what the costs might be.

Remember that this will establish a maintenance framework for years to come and all sorts of factors could effect the costs of implementing it.

shauna4419

moneyistooshorttomention wrote: »

The thing that would worry me most would be nothing in writing specifying what the position would be re annual "inflation rises". If there wasnt even something saying "The annual rises will be set at RPI or CPI level each year" then you could find that the RPI, for instance, was 2% in the previous year - but they have decided to up your annual bill by 3%, 4%, 5%, who knows what %:eek:. .

I agree entirely!

There is something mentioning prices rising or falling (Ha!) to 'a reasonable level', just like the admin fees are 'reasonable' though. I am not overly worried in regards to this, as our monthly income does have a generous amount of room for an increase in any such charges - but it's more of a principle thing if that makes sense?!

I'm also really a bit cross because I feel like the buyer's solicitor has 'kept this quiet' up until the last moment, and that my solicitor has been a bit inefficient in finding this out until now!

We are meant to be exchanging today or tomorrow and got the letter through on Saturday with their full terms and costing on? We have basically been told: sign it or we can't move forwards. I rang our solicitor and she said that it's not anything to worry about and that she's seen this really regularly before.

I'm equally as annoyed that when we went up to look at the house on Sunday, the grassy area in question was littered and entirely overgrown - didn't look like they'd come anywhere near it in at least a month, despite our documentation saying they come twice a month at least. We hadn't seen the area before because you can't see it from the house, but now it is even more of a kick in the teeth that they can charge so much for it.

We just have gotten SO emotionally invested in the house, it's incredibly frustrating that a tiny patch of grass and a company (If you can call them that! I have been to Google since, and not impressed with anything anyone has said) has overshadowed the enjoyment of the home.

Rant over! :rotfl:

Davesnave

shauna4419 wrote: »

I rang our solicitor and she said that it's not anything to worry about.....
I bet your solicitor won't put that in writing! Go on, email her and ask exactly what safeguards are in place to prevent steep increases in these charges.


I'm equally as annoyed that when we went up to look at the house on Sunday, the grassy area in question was littered and entirely overgrown...... We hadn't seen the area before because you can't see it from the house......

So, you didn't walk around the whole area several times before deciding to make the purchase?

Amazing!