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Freehold and intermediate Headlease

I'm looking for some advice.

I recently bough the freehold to my property but I still keep recing invoices for ground rent. After speaking to the management company they said their client owns the intermediate Headlease interest in my property and I'm still required to pay ground rent even though I own the freehold.

Is this correct?

I thought once I owned the freehold, I would own the land and no longer have to pay ground rent. The land registry shows the property as freehold. Can anyone advise what I can do next?

Comments

  • loubel
    loubel Posts: 795
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    It sounds like there is a freehold title, which you now own, as freeholder.
    Under that there is a headlease, which your landlord owns.
    Under that is your lease, which you own as leaseholder.

    Each lease will set out obligations between the parties. If you pay ground rent in your lease then buying the freehold would not stop this. Does your landlord owe you, as freeholder, any ground rent in the headlease?

    Was this not explained to you by your solicitor when you bought the freehold?


  • eddddy
    eddddy Posts: 16,141
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    edited 5 February at 10:17PM

    In simple terms, there are 2 ways to buy the freehold of your house
    1. A legal process called 'Statutory Enfranchisement'
    2. Informal agreement with the freeholder

    If you did a 'Statutory Enfranchisement' then the intermediate lease would have been effectively cancelled. So in that case, your intermediate leaseholder would be mistaken in saying you owed ground rent.


    But if you made an informal agreement with the freeholder (i.e. you simply approached the freeholder, or the freeholder approached you), then the intermediate lease almost certainly still exists.  So you continue to be a leaseholder, and you must continue to pay ground rent and stick to the rules of your lease.

    If you made an informal agreement, did you consult a solicitor?

    To be honest, if you made an informal agreement, I think I would say that your freehold title is probably pretty much a waste of time. (Unless others can see a benefit.)


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