How long do I wait before I pull out of a sale?

BuyingSolo

Hi

This is more of rant than a question to be fair. Since May, I have been trying to buy a leasehold flat. I have done the survey and got my mortgage arranged, but the conveyancing is taking forever. Part of the issue is that I have asked about a deed of variation because of a ground rent doubling clause ('not the worst I have seen, but the not the best' according to my surveyor).

The seller's solicitor is taking ages to respond to stuff. All they have said about the deed of variation is that they think it's unlikely that the freeholder will agree to it (my solicitor has asked them to confirm that one). My mortgage lender is OK with it. Though, that's probably because they think the mortage will be paid off before the ground rent hits the dreaded threshold for an assured tenancy.

So, my question is. Do I just accept that leaseholds take a long time to porcess or do I cut my losses and pull out? I don't want to pull out as the flat is actually the best I have seen for my budget and I have kinda fallen in love with it. But at the same time, I don't want to be waiting forever.

Please, please can people resist the temptation to say 'don't touch leaseholds with bargepole' etc. In an ideal world, I would be buying a flat with share of a freehold. But, those are few and far between. And the ones I did see at my budget (£250K in London area) look like they were falling apart. 

However, mutterings of sympathy and other advice welcome.

CSI_Yorkshire

BuyingSolo said:

 I don't want to pull out as the flat is actually the best I have seen for my budget and I have kinda fallen in love with it. 

That's your answer.  Sometimes these things take a while.

YoungBlueEyes

Is the seller's solicitor waiting for answers from someone else, and that's the delay? Maybe they're trying to get answers re the ground rent and those are slow in coming?

lika_86

I assume you're  a FTB? You need to manage your expectations. Even a bog standard freehold purchase with no chain and reasonably motivated parties can take around three months. Leaseholds take much longer to go through because they're more complicated but also generally involve more waiting for stuff which is out of the seller's hands.

Tiglet2

BuyingSolo said:

Hi

This is more of rant than a question to be fair. Since May, I have been trying to buy a leasehold flat. I have done the survey and got my mortgage arranged, but the conveyancing is taking forever. Part of the issue is that I have asked about a deed of variation because of a ground rent doubling clause ('not the worst I have seen, but the not the best' according to my surveyor).

The seller's solicitor is taking ages to respond to stuff. All they have said about the deed of variation is that they think it's unlikely that the freeholder will agree to it (my solicitor has asked them to confirm that one). My mortgage lender is OK with it. Though, that's probably because they think the mortage will be paid off before the ground rent hits the dreaded threshold for an assured tenancy.

So, my question is. Do I just accept that leaseholds take a long time to porcess or do I cut my losses and pull out? I don't want to pull out as the flat is actually the best I have seen for my budget and I have kinda fallen in love with it. But at the same time, I don't want to be waiting forever.

Please, please can people resist the temptation to say 'don't touch leaseholds with bargepole' etc. In an ideal world, I would be buying a flat with share of a freehold. But, those are few and far between. And the ones I did see at my budget (£250K in London area) look like they were falling apart. 

However, mutterings of sympathy and other advice welcome.

To answer your question, yes you need to accept that leaseholds take a long time to process.

First of all, when you made your offer it would still take the best part of a month for the seller to submit all his paperwork and funds to the solicitor, who then opens the account and processes ID documents before they actually start any of the legal work. 

They have to gather papers to send to your solicitor, such as the documents that the seller submits (Fixtures & Contents, Property Information Form & Leasehold Information Form and any warranties or certificates they hold).  The solicitor then downloads title documents from the Land Registry and contacts the freeholder/management company for details of any management pack needed. 

They would draft the contract for approval by your solicitor.  The solicitor would also need to obtain funds from the seller to buy the pack, or get the seller to pay the man co directly.  The solicitor sends the pack of papers (known as draft contracts) to your solicitor (sometimes with or without the management pack at this early stage).

Your solicitor would then need to review all those documents in order to start raising enquiries.  If the man co pack arrives at a later stage, then this would also need to be reviewed and enquiries made at a later stage.

Believe it or not, there is far more for the seller and their solicitor to do in the early stages as they need to provide all the documents requested by your solicitor.

When you say your solicitor is taking ages to respond, you should be aware that your solicitor is most likely waiting for someone else to respond and they cannot estimate how long a third party would take.  

Now that 2 months, nearly 3 months, have passed, I would assume that enquiries are now in progress.  Some of those enquiries may well relate to the Deed of Variation, but that would be confirmed in the management pack or it would be referred to the lender if it was thought to be onerous.  The surveyor is not the person to give advice on this as it is not really their area of expertise.  Can you phone your solicitor to ask about this?  When you say doubling ground rent, what exactly are the terms?

Like you my son had to buy a leasehold flat in the London area for a similar price.  Considering the firm I worked for did his conveyancing, so they were "on it" extremely quickly, it still took 6 months to completion, mainly because it took ages for the seller's solicitors to satisfactorily give full answers to enquiries and provide the requested paperwork.  

Exodi

I'd imagine you're a first time buyer... offer accepted in May, we're 2 months on in July and you're talking about pulling out because it's taking too long...

Out of interest if you did pull out of "the best [property] I have seen for my budget" and one that you have "fallen in love with" - what would you do next? You'd just end up wasting a lot of peoples time (including yours), money and restart the clock at some other property.

My last property (a detached uninhabited chain free house) took nearly 6 months to complete. You just have to take a breath and wait - these types of threads (a FTB pulling their hair out because they think the conveyancers are asleep as it's already been a month and they don't have the keys yet??) are incredibly common and are the reason a lot of people are hesitant to sell to first time buyers

Jonboy_1984

When we sold last year our (FTB) buyer was making a lot of noise about only being prepared to wait a little while for us to find a place, and wanting us to break the chain if nothing found within a few weeks.

I ran this past our solicitor who replied that the quickest a leasehold mortgaged purchase will go through is around 16 weeks due to the freeholder/management agent involvement etc (vs 8-12 for a freehold house).

Excluding a couple of non-legal issues (one with the buyer, one with our vendor) they were just about spot on.

MultiFuelBurner

Our last freehold purchase was 16 weeks long. Add in the complexity of a leasehold.

I always expect leasehold to take 5-6 months.

youth_leader

My 'cash' freehold purchase took six months - although I do think it would have been faster if the vendor had been more responsive.  My solicitor wrote to me after five weeks to say he'd heard nothing from the vendor's solicitor, I rang the EA to enquire.  It took the vendor two weeks to inform the EA that her solicitor had gone off sick with Covid and the file laid unopened on her desk, it hadn't been reallocated. 

NameUnavailable

Think carefully - the doubling ground rent might not be an issue for your lender right now (although they only seem to check this stuff before actually issuing funds so you might find out further down the line that it IS a problem) but it might make it difficult when you want to sell.

There is no obligation on the freeholder to do anything. That's probably why getting a response is taking a while!

How much is the GR? When does it double? How long is the lease?

If you wanted to extend the lease 2 years after buying (and reduce the GR to peppercorn) it might be very costly.

BuyingSolo

Thanks all. I am FTB - and buying by myself. I kinda knew that I have to be patient etc. But v difficult when you're doing it all by yourself and don't know what to expect. My siblings have only owned freeholds, so I think they don't really get it. Estate agent wasn't helping as they kept chasing me about it - until I told them to stop because they were stressing me out (and the fact the hold up is with the seller's solicitor, not mine). 

GR doubles every 25 years and is due to double in about 15 years (new lease from 2014). Alas, extending the lease only reduces the GR to a peppercorn at the point the old lease runs out or something. I think anyway. But, extending the least might prevent you going across the threshold of an assured tenancy (£1K in London). That's the bit lenders don't like.