50 yrs lease remaining?

rabialiones

hi, i have just come across the following quote on another forum, i have googled but not found any info about it?
do any of our fellow forumites know anything about this.-

" in 2040 the leasehold reform act, passed in 2002/03, comes into force. This means that in all situations where the land was leased to be able to build on for houses in the victorian times, the freehold land will automatically revert to the leaseholder. I would imagine that this only applies for places where the land was leased for building rather than the shorter leases on flats etc. "

Harryp_24

rabialiones wrote: »

unfortunately, she does not have any evidence , it was just a verbal question and she did not check paperwork herself as she thought everything would be ok as she relied on solictors professional expertise to see all paperwork would be ok.

You dun goofed.

rabialiones

she was never given paperwork by solicitor to check, he just told her searches had come back and everything was ok

Okrib

Firstly, this all sounds very confusing and without the Land Registry documents to look at, I’m guessing at to what’s going on.

Is there a garage separate / annexed to the house? Sometimes the house itself will be freehold and the garage leasehold.

There could be a situation, much like you get with flats, where there is a freehold title and a leasehold title – it wouldn’t make much sense but it can happen. If your friend owns both, then no big deal (though the lease should be extended straight away).

The paperwork from the mortgage company should detail the tenure of the property, and they should have notes on file. Many lenders will lend on even very short leases, it depends on what percentage deposit was being put down.

All that said, I find it very unlikely that a solicitor and a mortgage company would approve the purchase of a leasehold house with 55 years remaining without making it very clear (in writing) that this was the situation.

Your friend was also very silly for not checking all documents thoroughly, there really is no excuse for that.

Post the Land Registry documents (with address details redacted) and it will be a lot easier to figure out.

KiKi

If your friend is that stressed that she can't sleep, then she either needs to pay a solicitor to review, or let you post the redacted documents. There's no point just stressing and hoping that people can guess what's going on!

Richard_Webster

First of all OP's friend should obtain the Land Registry documents for the freehold for his/her property, to see who the registered proprietor of the freehold is. It is always possible that the friend bought both freehold and leasehold titles and the solicitors simply forget to send the freehold copy entries. Possibly they only sent historic documents for the friend to keep if he/she wanted.

It really is important to be clear about the facts first.

If the freehold title is in a different name then the friend should instruct solicitors to claim against the solicitor who acted on the purchase. Regardless of whether or not the property was mortgageable at the time, it would have been pretty obvious when the property was purchased that when selling in the near future ot would be unlikely to be mortgageable, and the solicitors should have clearly warned the friend of this in writing. If they didn't then they were negligent.

House insurance and indemnity insurance policies mentioned by the solicitor would have nothing to do with this. The only relevant indemnity policy is that held by the solicitors themselves. They will have to claim on it when they receive a claim from the friend's solicitors.

rabialiones

will ask her for LR docs.
no garage
she spoke to negligence solicitor this a.m.
advised not to speak to original solicitor as they could alter/add documents.
he could request file from them and look at it to see if they had been negligent

she was thinking of going to legal ombudsman , but would have to take up issue with solicitor initially to try and resolve matter , before they would look at it.

HouseBuyer77

Should your friend indeed own a property with a 50 year lease remaining I'd say you have a strong case against the conveyancing solicitor. It will be hard for them to claim they they informed your friend of the short lease when they were also operating for the mortgage lender. They would have had to tell the mortgage lender this too which would have led to the mortgage being declined. As this didn't happen it means the solicitor didn't correctly determine this in the first place.

I guess there's a couple of possiblities where this could happen:

1. Your friend has a lender happy with a 50 year lease, maybe such lenders exist but I seriously doubt it'd be a standard mortgage (specialised lender, would have required work to find them, mortgage rates higher than usual etc) and as such your friend would have realised they were getting a special mortgage for a special situation.

2. The conveyancing solicitor did indeed inform your friend of the short lease but told the lender it was freehold/long lease. Here they've still done their job incorrectly but it's the lender who has suffered. Uncertain how things would play it that situation.

Talking to a decent solicitor specialised in such matters is certainly the next step. This isn't something you can DIY. Sounds like she's already begun the process, I hope it works out for her.

theEnd

HouseBuyer77 wrote: »

Should your friend indeed own a property with a 50 year lease remaining I'd say you have a strong case against the conveyancing solicitor. It will be hard for them to claim they they informed your friend of the short lease when they were also operating for the mortgage lender. They would have had to tell the mortgage lender this too which would have led to the mortgage being declined. As this didn't happen it means the solicitor didn't correctly determine this in the first place.

The lender will want to sue too. If that's the case.

I still suspect there's more to it. Maybe the solicitor forgot to register the change in ownership of the freehold or something. In which case, should be easy to correct.

HouseBuyer77

The lender will want to sue too. If that's the case.

Indeed, though I have no idea what lenders like to do in such situations.

Incidentally this is a reason to tread carefully, if the lender finds out their security isn't as great as they thought there could be consequences. Of course a good solicitor advising you will be aware of this and ensure such consequences are minimised.