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There's no way to go back to his sole ownership is there?
I doubt it.
The frustrating thing is that, had you been advised correctly, you could have easily got around it by your partner serving a section 42 notice before transferring ownership.
As I was suggesting, if you explained your plan to your solicitor, and your solicitor failed to advise you that your plan would not work, there may be scope for a complaint.
So you could ask your solicitor for their comments.
(Perhaps there is also scope for a similar complaint about your financial advisor, but it seems less likely.)0 -
Hi all,
Just hoping for some advice....
I have owned my flat for over 2 years and have approx 85 years left on the lease. During a conversation with the managing company i asked about extending the lease to which his reply was that it would be 'prohibitively expensive'.
When i bought the flat i was aware that the ground rent doubles up every 10 years throughout the term (starting from £250) but the flat was relatively cheap and it was always my intention that i was simply extend when the time came... Is there a calculator i can use to estimate how much the extension would cost? Or does anyone have any experience regarding this? It's worth £240,000, not a new build and i am not the first owner.
The obvious answer would be to find a specialist solicitor to deal with it but although i do have some funds, i am wary of starting something i cannot finish at this point if the cost are as high as suggested.
Thanks in advance.0 -
familyguy101 wrote: »Hi all,
Just hoping for some advice....
I have owned my flat for over 2 years and have approx 85 years left on the lease. During a conversation with the managing company i asked about extending the lease to which his reply was that it would be 'prohibitively expensive'.
When i bought the flat i was aware that the ground rent doubles up every 10 years throughout the term (starting from £250) but the flat was relatively cheap and it was always my intention that i was simply extend when the time came... Is there a calculator i can use to estimate how much the extension would cost? Or does anyone have any experience regarding this? It's worth £240,000, not a new build and i am not the first owner.
The obvious answer would be to find a specialist solicitor to deal with it but although i do have some funds, i am wary of starting something i cannot finish at this point if the cost are as high as suggested.
Thanks in advance.
[FONT=Verdana, sans-serif]To give you a rough idea use one of the online calculators to estimate the lease extension premium assuming the ground rent was fixed at £250 pa.
[/FONT] [FONT=Verdana, sans-serif]Then in a spreadsheet list out all the fixed increases in the ground rent over the £250 and discount them at say 6% pa.
[/FONT] [FONT=Verdana, sans-serif]So for example if its 5 years time the the rent increases to £500 then the extra will be:
[/FONT] [FONT=Verdana, sans-serif]Year 5 = (£500-£250)/1.06^5 = £186.81[/FONT]
[FONT=Verdana, sans-serif]Year 6 = (£500-£250)/1.06^6 = £176.24
[/FONT] [FONT=Verdana, sans-serif]As so on and so on including:
[/FONT] [FONT=Verdana, sans-serif]Year 15 = (£1,000-£250)/1.06^15 = £312.95
[/FONT] [FONT=Verdana, sans-serif]etc, etc for each year of ground rent still to pay
[/FONT] [FONT=Verdana, sans-serif]That way add up all of those figure for the next 85 years and add it to the basic calculator figure.[/FONT]
[FONT=Verdana, sans-serif]The actual discount rate will be a matter of negotiation so try 6%/6.5%/7% to give you an idea of how the value can change
[/FONT] [FONT=Verdana, sans-serif]You can then decide whether it is worthwhile employing a RICS surveyor to give you a more formal idea of what values might be agreed.[/FONT]0 -
I doubt it.
The frustrating thing is that, had you been advised correctly, you could have easily got around it by your partner serving a section 42 notice before transferring ownership.
As I was suggesting, if you explained your plan to your solicitor, and your solicitor failed to advise you that your plan would not work, there may be scope for a complaint.
So you could ask your solicitor for their comments.
(Perhaps there is also scope for a similar complaint about your financial advisor, but it seems less likely.)
Casting your mind back to this post, can you please help?!
Today we received our title deed back as incomplete (needing more information) from the solicitors handling the mortgage (Qcas), so two months later we have discovered that the title deed completion did not happen. So for all purposes I guess the title is still in my partners name only, and has been for almost 3 years.
The mortgage completion in both our names went through on 28/02.
Upon learning this today, immediate first thought was - can we just keep the title deed as it is, ignoring the completion of the change?
Asked Qcas and they said no, it's started so must be finished. If we want a sole proprioters mortgage we would have to remortgage.
We also asked Barclays mortgage deed dept over the phone and they said the mortgage doesn't have to match the title deed and we could just keep a sole title deed. However this was telephone hearsay so must not be accurate.
Would you be able to help? Thanks.0 -
Casting your mind back to this post, can you please help?!
FWIW, I can see why your solicitors aren't advising you about the lease extension:QCAS was established in 1999 to deliver a commoditised remortgage service for banks and building societies.
Link: https://portals.shulmans.co.uk/Qcasweb/AboutUs
They are just a 'conveyor belt' remortgaging service.
I don't know the full answer to your question... but if ownership of the lease hasn't been transferred yet, your partner needs to instruct a solicitor and valuer, and serve a section 42 notice on the freeholder, to start the lease extension process.
Once that is done, it's OK to transfer ownership of the lease, if you still want to (and assign the benefit of the section 42 notice).
In your position, I would phone 1 or 2 or 3 'proper' solicitors who specialise in lease extensions and property - and explain what you want to do.
Most solicitors will discuss your problem with you on the phone for 20 or 30 mins at no charge, and give you an idea of whether they can help you or not (and what it might cost).0 -
If I have missed a similar situation scanning through the thread, I apologise.
Presently we live in our mortgage free freehold house, but we will be 82 later this year, so are thinking soon we may need to downsize to a flat. In our town are a number of flats, but many unexpired terms are in the 65-85 bracket. Clearly, we are not going to live that long, so extension is not something we need per se.
In theory, therefore, we could occupy one of those available until we either die or go into a home, and accept the depreciation in value until those events.
Is there any method to estimate such depreciation, and how advisible is such a course?
P.S. As well as the foregoing, there are some Mccarthy and Stone/ Churchill developments built in the last 2 years, where the short lease problem would not apply, but they are expensive. Might they be less problematical for us to deal with and worthwhile value?0 -
If I have missed a similar situation scanning through the thread, I apologise.
Presently we live in our mortgage free freehold house, but we will be 82 later this year, so are thinking soon we may need to downsize to a flat. In our town are a number of flats, but many unexpired terms are in the 65-85 bracket. Clearly, we are not going to live that long, so extension is not something we need per se.
In theory, therefore, we could occupy one of those available until we either die or go into a home, and accept the depreciation in value until those events.
Yes - you can just accept the depreciation, if you want to.
As you probably know, extending a lease costs money - but overall you normally make a profit on it (because the flat becomes more valuable).
So by extending the lease, you might end up with a larger estate to leave in your will - but perhaps that isn't important to you.Is there any method to estimate such depreciation, and how advisible is such a course?
Probably the easiest way is to look at the prices of similar flats in your area with, say, 65 year leases and 100+ year leases to see the difference.
And/or you can ask some local estate agents for their opinion. (But if there is a particular flat that the agent wants to sell you, they might give you a biased opinion.)P.S. As well as the foregoing, there are some Mccarthy and Stone/ Churchill developments built in the last 2 years, where the short lease problem would not apply, but they are expensive. Might they be less problematical for us to deal with and worthwhile value?
They should certainly be less problematical. But the yearly service charges can also be very high.
That's because often with retirement flats, the management company are responsible for things like heating, electrics, plumbing (and maybe even kitchen and bathroom fittings) in the flat.
So, for example, if your heating breaks down, or a pipe leaks in your flat, the management company come and fix it - and they don't charge you. Instead, it's covered by the high yearly service charge.
Also, they sometimes have a warden that visits you each week, to check if everything is OK. And so the warden's wages have to be paid out of the service charge.
(But check all these details at your local developments. I guess different developments might have different policies.)0 -
FWIW, I can see why your solicitors aren't advising you about the lease extension:
They are just a 'conveyor belt' remortgaging service.
I don't know the full answer to your question... but if ownership of the lease hasn't been transferred yet, your partner needs to instruct a solicitor and valuer, and serve a section 42 notice on the freeholder, to start the lease extension process.
Once that is done, it's OK to transfer ownership of the lease, if you still want to (and assign the benefit of the section 42 notice).
In your position, I would phone 1 or 2 or 3 'proper' solicitors who specialise in lease extensions and property - and explain what you want to do.
Most solicitors will discuss your problem with you on the phone for 20 or 30 mins at no charge, and give you an idea of whether they can help you or not (and what it might cost).
I wonder if you could help me further please.
I contacted about 10 specialist lease solicitors. Maybe two came back to me and said they could help, whereas about four said it was seen as contested and they wouldn't help me.
I've just spoken to the lease advisory service who flat out denied that there was a chance the lease could be extended through delaying sending the TR1 back and using the interim to send the section 42 bacK.
Lease advisory said that the TR1 land registry being sent back as incomplete does not mean that the change in ownership has not gone through. It may have been acknowledged just by the application at Land Registry?
The one solicitor I've found who's happy to take the case on says that all they can do is write a s.42 and assignment of benefit (for £1k ) and see what happens, whether the Freeholder may object then.
Lease Advisory said the Freeholder will object with grounds that they signed a Licence to Assign in February (which has now run out) which showed intention of us changing the ownership - and that is grounds to dismiss the lease extension being in the original name.
My question is - what do you think I should do? Do you think the Freeholder would query it, she does believe the property has changed to both of our names - so what could she use/and would she use some method to find out current title deed?
Would it just be land registry or would it be something else?
Would she just highlight the fact we used a licence to assign as ground to object to the lease extension.
Please can someone help before I go and pay for this legal stuff that may end badly.0 -
The one solicitor I've found who's happy to take the case on says that all they can do is write a s.42 and assignment of benefit (for £1k ) and see what happens, whether the Freeholder may object then.
Lease Advisory said the Freeholder will object with grounds that they signed a Licence to Assign in February (which has now run out) which showed intention of us changing the ownership - and that is grounds to dismiss the lease extension being in the original name.
So essentially...
your solicitor is saying the s42 won't be valid... but he/she's willing to take a punt and serve it anyway, to see if the freeholder is dopey enough not to notice.
I suppose it's impossible to guess how dopey or diligent the freeholder is.
Lots of freeholders don't like statutory lease extensions, so probably go through s42 notices with a fine-tooth comb looking for reasons to reject them.
Once you serve an s42, you become liable for all the freeholder's valuation and legal costs - which could be £2k to £4k for a lease extension.
It might be worth asking your solicitor if the freeholder can run up costs, present you with a bill for £4k, before rejecting your s42.
Others may have a better informed answer.0 -
I came across https://www.freeholdcalculator.com/leasehold_extension.php
The site purports to give detailed calculations. Those include
Yield Rate:6%; Reversion Rate: 5%, the latter fixed by case law.
However the former is not so fixed, and as current interest rates are low and continue for some time, do some free holders now apply a lower discount rate to the future income stream, and so additional costs to the lessee?0
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