Last Minute Demands Before Exchange

Muddyb

Hi all,
My flat is in the process of being sold, but on the day that we were supposed to exchange, I've found out that the buyer is demanding that I start the lease extension process (currently 90 years) before we can exchange. This point was raised several weeks ago and I thought it had been dealt with at the time, but it has come up at the last moment. I've no idea how long the delay would be if I caved into the demand, but it's incredibly frustrating. Any advice appreciated.
MB

da_rule

It might not delay it at all, all you have to do is serve the notice. Then when you complete you assign it to the new owner.

Just get the seller to say how much they want to offer for the extension and give you an undertaking that they will cover your costs and the freeholders costs.

lookstraightahead

I agree with your first paragraph but asking the buyer to pay for the stability of a longer lease (let's face it 90 years is nothing) is a bit OTT and might upset the buyer

G_M

If the buyer wants the extension then the buyer should be willing to pay for it.

To have got this far and then raise it at the last minute is absurd.

I'd agree provided any delay was 1 week at most and the buyer paid any costs. Otherwise I'd instruct the EA to put the property back on the market.

SmashedAvacado

If they just want you to Serve notice then why not make it a contractual obligation for you to do this post exchange pre completion- this way you know they are committed to buying.

Tom99

SmashedAvacado wrote: »

If they just want you to Serve notice then why not make it a contractual obligation for you to do this post exchange pre completion- this way you know they are committed to buying.

Yes that is the way it must happen. You contract to serve a Section 42 notice after exchange and before completion. You also contract to assign that notice to the buyer because without that assignment to notice will be useless to the buyer.
Don't serve notice before exchange, the buyer could pull out and you would be stuffed with the freeholder's costs even if you abort the application.
You could ask the buyers solicitor to draw up the Section 42 notice you will serve, this may save you a small fee but also if they happen to make a mistake and you end up serving an invalid notice it will be their fault not yours.
There is no reason why this should delay the exchange for more than a few days if everyone gets their act together.

Muddyb

Thanks all. This is really helpful advice. Let's see how these discussions go. Annoying how this has been raised so late in the game!

Muddyb

Well, in the end, it all worked out. The agent pushed back to say that 90 years is sufficient. The seller eventually agreed and we exchanged this morning. Relief.

Thanks for the advice everyone.