Buying a flat with the original lease missing

mimi111

Hello,

I am 4 months into buying a flat and I've just been told that the original lease documents are missing (supposedly one from 1958 and one from 1980). We have all of the subsequent deeds of variations. 

The seller has offered indemnity insurance to cover losses (minus 'adverse interest'?).

If we go ahead, I'd like to surrender the lease and regrant a new one, but I have no idea the cost or whether the other share of freeholders would be open to it.

My solicitor isn't providing any advice and I have had very mixed reviews from family friends. How common is a missing lease and how bad an idea is it to proceed?

bouicca21

Faced this exact same problem when buying my flat. Answer was for solicitor to get cast iron guarantee of a new lease and how much it would cost (surrender and regrant) and for the vendor to make an allowance on the purchase price to cover the cost.  The leases in the building were pretty standard so creating a new one for my flat was pretty much a cut and paste job.

I was a cash buyer. I’m not sure if this arrangement would have worked if a mortgage were required, or if the leases for neighbouring flats were not standardised.

GDB2222

You are buying a defective product. You either need to be getting it at a bargain price, say 25% off, in which case it is up to you to sort out the issues. Or, if you are paying full price, the seller needs to sort out the issues, in which case Boudicca's solution sounds pretty good. 

mimi111

bouicca21 said:

Faced this exact same problem when buying my flat. Answer was for solicitor to get cast iron guarantee of a new lease and how much it would cost (surrender and regrant) and for the vendor to make an allowance on the purchase price to cover the cost.  The leases in the building were pretty standard so creating a new one for my flat was pretty much a cut and paste job.

I was a cash buyer. I’m not sure if this arrangement would have worked if a mortgage were required, or if the leases for neighbouring flats were not standardised.

thank you for your quick and helpful response. i've been advised by my solicitor that for us to create a new lease, all the other leases would need to be surrendered and regranted too (so mine and the 3 other owners in the building). was this the case for you too? and did you have issues getting the other owners to agree to proceed? 

bouicca21

None of the other leaseholders were involved and I don’t understand why they would need to be.  Ask your solicitor for an explanation.

With hindsight I wish I’d been more hard nosed about the whole,thing and driven the price down.  After all the chances of the vendor finding another buyer were pretty slim.

mimi111

bouicca21 said:

None of the other leaseholders were involved and I don’t understand why they would need to be.  Ask your solicitor for an explanation.

With hindsight I wish I’d been more hard nosed about the whole,thing and driven the price down.  After all the chances of the vendor finding another buyer were pretty slim.

Can I ask who the solicitor was that you used for this? I appreciate you might not want to share but I need someone who's done this before (surrendering and regranting). 

GDB2222

mimi111 said:

bouicca21 said:

None of the other leaseholders were involved and I don’t understand why they would need to be.  Ask your solicitor for an explanation.

With hindsight I wish I’d been more hard nosed about the whole,thing and driven the price down.  After all the chances of the vendor finding another buyer were pretty slim.

Can I ask who the solicitor was that you used for this? I appreciate you might not want to share but I need someone who's done this before (surrendering and regranting). 

The alternative is to pass the buck back to the seller, and wait with your purchase until the seller has a shiny new lease. 

Or, buy a different flat!

loubel

It should not be necessary for the other leases to be regranted unless you are asking for the terms to be varied. Assuming all of the lesses are meant to be the same, do the other leaseholders have a copy of their original lease from which a new lease could be drafted?

bouicca21

mimi111 said:

bouicca21 said:

None of the other leaseholders were involved and I don’t understand why they would need to be.  Ask your solicitor for an explanation.

With hindsight I wish I’d been more hard nosed about the whole,thing and driven the price down.  After all the chances of the vendor finding another buyer were pretty slim.

Can I ask who the solicitor was that you used for this? I appreciate you might not want to share but I need someone who's done this before (surrendering and regranting). 

Solicitor now retired.  Besides, it’s up to the the vendor’s solicitor to sort out a solution. 

 

eddddy

You mention "share of freehold" and 4 owners, so it sounds like there are 4 people jointly owning the freehold - so all 4 would need to agree and cooperate with the re-grant.

One slightly contentious issue might be that a re-granted lease will probably have to have zero ground rent - because of a change in the law.  And it would be sensible to make the lease 999 years.


It's a bit of a wild guess, but could the issue be that, if you get a new lease with zero ground rent and 999 years, the other 3 people want the same, for fairness?


(It may be that ground rent isn't collected, but if it's still mentioned in the lease and is onerous, it could cause problems with mortgaging / remortgaging. The same if the length of the lease starts getting short.)