Lease extension

Tom99

[FONT=Verdana, sans-serif]If you have started the statutory lease extension process by serving a section 42 notice remember you both have to comply strictly with the counter notice timetable.[/FONT]
[FONT=Verdana, sans-serif]Don't get distracted by these other alternative offers and overlook the statutory timetable as you may lose your automatic right to a lease extension.[/FONT]

eddddy

As Tom99 suggests, your freeholder might be trying to distract you from your statutory lease extension by making informal offers.

If that is the case, you might have 3 options open to you:

- Continue with the statutory lease extension option
- Discontinue with the statutory route and accept the £20k offer
- Discontinue with the statutory route and accept the £17.5k offer

Overall, the statutory lease extension is likely to be best value for money (even if it is not the cheapest). And legal and valuation fees will also be higher for the statutory extension.

Also, some freeholders can be nasty and try to trick leaseholders. For example, they persuade you to discontinue the statutory lease extension... then shortly afterwards, withdraw their £20k and £17.5k offers.

You should carefully follow your solicitor's and valuer's advice on this.

Tom99

A few other freeholder tricks are listed here:

https://www.leaseholdknowledge.com/lease-extension

https://www.leaseholdknowledge.com/informal-lease-extensions-are-pure-poison

Suzieclow

Hi everyone thanks for the information. I believe we started the statutory lease process. The offers have come to us via the landlords surveyor. I am trying to get legal advice before we finalise but at present are still waiting for the surveyor to answer my last email. So perhaps time wasting is on their agenda.
Thanks agai.

Tom99

[FONT=Verdana, sans-serif]You need to find out if you have started the statutory process or not.

[/FONT] [FONT=Verdana, sans-serif]If you have, you will have signed a section 42 notice sent to the freeholder stating the premium you are willing to pay. Normally this notice will have been prepared by your solicitor not your surveyor.

[/FONT] [FONT=Verdana, sans-serif]The freeholder normally has 2 months to issue you with a counter-notice which, if your section 42 is valid, will normally include their opinion of what premium you should pay.[/FONT]

Jatinder77

Suzieclow said:

Thanks Tom. We have served the notice and paid surveyors fees. Just at negotiation stage now.
I will never buy a leasehold property again, such an unfair and stressful process

Once again I appreciate the advice

Suzie

Good to hear that the process is over and you come well out of it but now as you said you are in negotiation stage then you should take care of some points for negotiation like first of all you must know when yo should go for negotiation?

Firstly, You could take the traditional approach where the leaseholder serves the Section 42 Tenant Notice, which is followed by the Section 45 Counter Notice from the freeholder where they decline the amount suggested and put forward their premium. Negotiations happening at the Section 45 Notice stage involve solicitors, surveyors, and additional expenses that they bring with them.

Secondly, You could choose the alternate method where negotiations happen before the leaseholder serves the Section 42 Notice. In case you’re in direct contact with the freeholder or the management company, you can directly write to them stating your intentions of extending the lease and see if they’re open for negotiation. This saves costs that you would normally pay solicitors or surveyors at the Section 45 stage. 

eddddy

Jatinder77 said:

Good to hear that the process is over and you come well out of it but now as you said you are in negotiation stage then you should take care of some points for negotiation like first of all you must know when yo should go for negotiation?

Firstly, 

<snip>

You're replying to a post that was made in February 2018.

I imagine that the lease extension was done and dusted a long time ago!

(And the OP hasn't logged in for almost 2 years.)

Jatinder77

eddddy said:

Jatinder77 said:

Good to hear that the process is over and you come well out of it but now as you said you are in negotiation stage then you should take care of some points for negotiation like first of all you must know when yo should go for negotiation?

Firstly, 

<snip>

You're replying to a post that was made in February 2018.

I imagine that the lease extension was done and dusted a long time ago!

(And the OP hasn't logged in for almost 2 years.)

oohh, yes you right, I did not gave attention to the time and date of post.....silly me...Thank you for pointing out...appreciated... 

Jatinder34

Suzieclow said:

Hi
I am in the middle of a lease extension and have been given the following offer. Any thoughts on the 33 year rent doubling? They tell me this is to help me achieve an affordable solution but I think long term it’s going to cost me more.

“They are prepared to offer two proposals
A premium of £20,000 for a new 99 year lease, being the same term as the original lease, with a peppercorn rent
A premium of £17,500 for a lease to 125 years with a peppercorn ground rent for the next 5 years and there after £250 doubling every 33 years

both offers are plus statutory costs.”

Also what are the statutory costs he refers to. And how much should I be paying for the land registry?

Sorry for so many questions at once.

Thank you.

I think the first option of the premium cost would go well, but you need to ask the landlord for negotiation. As I am not a surveyor or an expert but you should consult a chartered surveyor.

eddddy

Jatinder34 said:

Suzieclow said:

Hi
I am in the middle of a lease extension and have been given the following offer. Any thoughts on the 33 year rent doubling? They tell me this is to help me achieve an affordable solution but I think long term it’s going to cost me more.

“They are prepared to offer two proposals
A premium of £20,000 for a new 99 year lease, being the same term as the original lease, with a peppercorn rent
A premium of £17,500 for a lease to 125 years with a peppercorn ground rent for the next 5 years and there after £250 doubling every 33 years

both offers are plus statutory costs.”

Also what are the statutory costs he refers to. And how much should I be paying for the land registry?

Sorry for so many questions at once.

Thank you.

I think the first option of the premium cost would go well, but you need to ask the landlord for negotiation. As I am not a surveyor or an expert but you should consult a chartered surveyor.

Are you the same person as @Jatinder77 who posted earlier in this thread, and was later banned from posting? See https://forums.moneysavingexpert.com/profile/comments/Jatinder77

Either way, the original post is 3 years old.