Selling Leasehold Flat with maintenance charges due

Debt_Overload

Hi there, I own a leasehold flat. 

Our leases are not very specific on its repayment timescale. I have a demand, issued correctly to my knowledge, for my share of the years' maintenance, of around £2000, with a due date of March 2026. I had intended to pay it all in early March as I did last year, with no repercussions.

However I now need to sell and I understand it is customary for the seller to pay their pro-rata share before sale and for the sale particulars to include a clause that the buyer will be responsible for the rest.

My difficulty is I don't have this amount to pay beforehand. Has anyone managed to sell it and can I have it paid from the sale money on the day, more importantly has anyone had their managing agent refuse to allow this? As I understand they do not have to agree.

Thank you 

ThorOdinson

If it's not due until march then you can simply pay your share out of the sale proceeds.

eddddy

It's very strange that you have been issued with a demand now, that is due to be paid in March 2026. Is there any possibility that you've misunderstood? 

Also, service charges are usually demanded in advance, not in arrears. So typically, a payment in March 2026 would cover April 2026 to March 2027.  But maybe you have a non-typical lease.

Or is this a payment for something specific - e.g. The roof is being repaired in May 2026, and your share of the bill is £2000

Debt_Overload said:

However I now need to sell and I understand it is customary for the seller to pay their pro-rata share before sale and for the sale particulars to include a clause that the buyer will be responsible for the rest.

That's not correct - there are a few misunderstandings.

If payment is due in March 2026, nothing needs to be paid to the Freeholder/Management Co before then (i.e. nobody has to pay the freeholder/management co a pro-rata amount before the property is sold, or when the property is sold)

Instead, the solicitors will make any adjustments (between the seller and the buyer) on completion of the sale.



For example, using made up numbers...

Let's say you sell the flat for £250,000

• If you owe the buyer a pro-rata service charge of, say, £900 - you'll only be paid £249,100 for the flat
• If you the buyer owes you a pro-rata service charge of, say, £900 - you'll be paid £250,900 for the flat

And the £2000 bill will be paid in full in March 2026.

There might also be a retention of maybe £500, in case of future service charge bills turning up.

Debt_Overload

Thank you. But my understanding is the "freeholder" will not ordinarily allow the sale if charges are "owing"? The lease is as clear as mud - I will attach the relevant clause which seems to suggest instalments but hasn't ever been enforced. 

eddddy

Debt_Overload said:

Thank you. But my understanding is the "freeholder" will not ordinarily allow the sale if charges are "owing"? 

That's correct.

But you said the £2000 payment has a due date of March 2026.

So until March 2026, the amount owing to the freeholder would be £0.

eddddy

But looking at your lease, it sounds more like you should be paying 2000/12 = £167 per month, from now until March 2026.

In which case, if you are not paying the £167 a month, you are building up arrears (at the rate of £167 a month), and those arrears will need to be paid to the freeholder/landlord by your solicitor on completion.


(And more generally, if you're not paying £167 a month, it looks like you might be in breach of your lease, so the freeholder/landlord could take legal action against you - irrelevant of whether you sell or not. That could result in you having to pay some significant fees.)

Debt_Overload

eddddy said:

But looking at your lease, it sounds more like you should be paying 2000/12 = £167 per month, from now until March 2026.

In which case, if you are not paying the £167 a month, you are building up arrears (at the rate of £167 a month), and those arrears will need to be paid to the freeholder/landlord by your solicitor on completion.


(And more generally, if you're not paying £167 a month, it looks like you might be in breach of your lease, so the freeholder/landlord could take legal action against you - irrelevant of whether you sell or not. That could result in you having to pay some significant fees.)

Yes. You asked earlier was 2026 as a due date correct, I assume they've put this due date because of the expectation of payment in instalments. This agent isn't stupid and can definitely do annoying things by the book when it suits them, but they also didn't bother to chase the leaseholder who was four years behind until we screamed asking why there's been no payments.

I, like a couple of others, am just putting the money aside each month until March because we've learned they don't chase anyone. The demand is definitely just the yearly accounting. I'm looking to sell because there are works in the pipeline which I can't afford, but the Section 20 hasn't begun yet so it's definitely only the bog standard costs of insurance, water, management fees etc.

Thank you everyone for taking the time to reply. I'm hopeful now that I can have a solicitor ask the right questions and settle the maintenance with the buyer on sale day.