Seller refusing to sign LPE1 form

suoneena

Hi everyone, 

I'm a solo buyer in the process of buying my first home. It's a flat in a Victorian conversion with a 50% share of freehold. There are 3 flats altogether in the house, one flat owns the other 50% SOF and one is a leasehold. 

The trouble is - the seller is refusing to sign the LPE1 form („Leasehold Property Enquiries”). They filled in the form, but said they won't sign it, neither will the other co-freeholder. The seller is a resale company and they claim no knowledge of the property. The seller says they are not aware of any disputes, but there are some inconsistencies e.g. the ground rent has not been collected from the leaseholder for the last year. 

Could you please advise:
- Is the seller required to sign the LPE1 or can they choose not to? Is this common?
- What are the risks of proceeding without the signed LPE1?

Thank you!
(Needless to say I really like the property and would love to exchange... I've also already spent around £5k on legal fees, surveys etc)

m0bov

No form no sale. No mortgage would accept that. Would you?!

theartfullodger

Indeed: Buy somewhere else....

Wonder what they are hiding?

Brie

They can get their solicitor to sign it on their behalf.  That's what we had to do when selling MiL's flat.  Unfortunately we also had to pay the solicitor's fee of about £650.  It was worth it in the end to finish the transaction.  Whether they will agree to paying for it to complete the sale might need to be negotiated - you might need to pay if you are determined to have the place.

NameUnavailable

An LPE1 form isn't essential but some of the information is. What has your solicitors said?

As for disputes, how can they say there aren't any if they also say they don't know anything about the property?

Has ground rent ever been collected? It may be that there's no formal arrangements in place between the freeholder parties for maintenance etc. - you will have legal obligations towards the leaseholder so you need to look into that further I think.

Brie

Also what happens if there are future sales??  Do you as a conscientious citizen agree to sign about things that may or may not have happened before you were connected to the property?  Do you sign an LPE1 for just your portion of the building?

I agree - talk to your solicitor.

suoneena

Brie said:

They can get their solicitor to sign it on their behalf. 

I'm communicating with the seller via solicitors, and the seller's solicitor informed me the freeholders won't sign (they are representing both the seller and the co-freeholder). I'll run your suggestion past my solicitor as a potential alternative, however unlikely always worth a shot!

suoneena

NameUnavailable said:

What has your solicitors said?

Has ground rent ever been collected?

My solicitor advised against proceeding without the signed form (as this could suggest the form is invalid, and I'd probably have little recourse if the information was inaccurate). 

In the LPE1 form the seller says that ground rent was collected until 2020, and that no additional demands were requested. However the terms of the lease state yearly ground rent. I also know that there were issues with collecting ground rent from the leaseholder in the past, but that this was eventually resolved. 

Titus_Wadd

Your solicitor might be able to hold back the amount of unpaid ground rent for the time between the last collection and the completion date to cover a bill that might be presented to you as the new owner. 

user1977

How much is the ground rent? They can only chase a few years' arrears, so it's a finite risk at least, if that's the only significant unknown.

GDB2222

suoneena said:

Hi everyone, 

I'm a solo buyer in the process of buying my first home. It's a flat in a Victorian conversion with a 50% share of freehold. There are 3 flats altogether in the house, one flat owns the other 50% SOF and one is a leasehold. 

The trouble is - the seller is refusing to sign the LPE1 form („Leasehold Property Enquiries”). They filled in the form, but said they won't sign it, neither will the other co-freeholder. The seller is a resale company and they claim no knowledge of the property. The seller says they are not aware of any disputes, but there are some inconsistencies e.g. the ground rent has not been collected from the leaseholder for the last year. 

Could you please advise:
- Is the seller required to sign the LPE1 or can they choose not to? Is this common?
- What are the risks of proceeding without the signed LPE1?

Thank you!
(Needless to say I really like the property and would love to exchange... I've also already spent around £5k on legal fees, surveys etc)

You've spent £5k on fees? That's an awful lot. 

Your solicitor is acting for your lenders, and even if you want to go ahead your lenders may not be prepared to.