Selling a flat with no maintenance arangement

dancing_star

WHo collects contributions to buildings insurance? Who organises the insurance?

ginger_chocolate

dancing_star wrote: »

WHo collects contributions to buildings insurance? Who organises the insurance?

We pay this to the freeholder - via their agent, who send us a bill when it becomes due.

eddddy

ginger_chocolate wrote: »

I would really like to know about other block of flats in this situation - seeing as we can't be the only people thos has ever happened to. I imagine that if something as serious as the roof falling in were to happen, somebody would need to do something about it. But how does that work if people who are 'responsible' can't or won't pay?

All you can do is read and analyse your lease word-for-word and from end-to-end to find out how things are supposed to work.

There must be some kind of 'covenants' (or 'undertakings' or 'agreements' or 'promises') in the lease about maintenance.

Who is covenanting with whom?

i.e. In the lease, leaseholders will be 'promising' that they will do stuff - according to the lease who are they making the 'promise' to?

To help explain this concept, based on your posts, it sounds like there are the following covenants:

• The freeholder is promising (or covenanting, or undertaking) to the leaseholder that they will arrange insurance

• The leaseholder is promising (or covenanting, or undertaking) to the freeholder that they will pay a share of that insurance.

cattie

It is a very unusual & rather unfortunate predicament. As others mention here, a solicitor of a prospective buyer would advise them to walk away from a property with no structure for paying service or maintenance charges.

I think these would be the best people to ask advice from, it's a government funded agency offering help & advice to residential leaseholders. http://www.lease-advice.org/

ginger_chocolate

So we've studied the lease a little more and hadsome help with the interpretation. The leaseholders all undertake in the lease to carry responsibilty and costs for one sixth of the costs of maintenance and repairs to all internal and external communal areas. They promise this to the freeholder. A management and maintenance company enforcing service charges can only be put in place on instruction by the freeholder. We have found a local company who have given usa quote and said they are willing to approach the freeholder to ask if they are open to 'instructing' them (given past lack of communication from the freeholder, I don't have high hopes). However, I'vediscussed this with some of the other owners, and all bar one have so far said they wouldn't support this way forward as they simply can't afford to pay a monthly service charge (all of the other owner-occupiers are unemployed). I'm currently really tired of the whole thing and wondering whether we should just try and sell at auction to a cash buyer and risk taking a massive loss and learn the lesson not to be so naive when buying in the future. I don't think I can deal with being stuck here for years waiting for numerous other parties to sort themselves out!

G_M

You have several options:

1) advertise via an estate agent at a reduced price, and hope that the buyer finds a mortgage lender willing to take this on

2) advertise via an estate agent for 'cash buyers only' at a reduced price

3) sell at auction. Again, you'll get a reduced price, but someone will buy

4) Do the property up yourself. Fix the intercom. Paint the outside and internal communal areas. Do what needs doing and collect whatever you can from whichever other leaseholders will help.

5) go down the legal route to enforce the lease requirements and force all six leaseholders to
a) agree a programme of works and
b) pay their contribution.

To do this you'll need legal advice, and vague statements here about what the lease says is not enough. The full wording, quoted exactly, is needed for anyone to offer an opinion.

And then the time, cost and stress of legal enforcement.

Oh! The other option is tea and cake but I suspect that's not going to work!

economic

Sounds like a similar problem I had but worse!

Given you say some are unemployed in the building and can't afford to pay the maintenance bill it must be not such a great location?

Keep in mind any legal action you take will have to be disclosed to potential buyers who may very well walk away if there are known legal disputes.

When you bought did you receive a management info pack? I think your solicitor did a bad job and potentially give you wrong advice by letting you go ahead with purchase.

Unless you were desparate to sell, I would take it off the market and sort the issues out first without taking legal action.

What you can do and you don't need any other leaseholder to participate is to force the fh via tribunal I think to get a proper management company setup. May take some time but I think this is the only option if you are not desparate and want the full market price.

economic

By the way leasehold is such a dodgy area. It's so important when buying a leasehold property to get a proper solicitor to advice you. Far too many incompetent solicitors out there who give really bad advice!

Ozzuk

If they can't afford a service charge then you'll have a real battle if anything major fails, I'd be cutting my losses at this point and sending to auction.

moneyistooshorttomention

Ozzuk wrote: »

If they can't afford a service charge then you'll have a real battle if anything major fails, I'd be cutting my losses at this point and sending to auction.

Agreed - and the thought doesnt "sit easy" of trying to force unemployed people to pay anything at all on top of their own personal costs. If they're unemployed - then they've got plenty of time to "make a nuisance of themselves" if you try.