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Service charge payment - up front/monthly/quarterly

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energy1x
energy1x Posts: 77 Forumite
in House buying, renting & selling
I bought a new build property earlier this year and upon completion paid a number of months service charge up front, I believe this is standard practice.

Today I received a welcome letter from the management company, demanding that from September I pay the full year's monthly service charge for September 18 - August 19.

Is this reasonable? From all my friends and family who have ever lived in a leasehold they have always paid either monthly or quarterly. Is this a legal requirement?

I am going to check my lease later to double check the terms there too.

Any insight welcome!

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  • eddddy
    eddddy Posts: 16,443 Forumite
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    energy1x wrote: »
    Is this reasonable? From all my friends and family who have ever lived in a leasehold they have always paid either monthly or quarterly. Is this a legal requirement?

    No - there is no legal requirement like that.
    energy1x wrote: »
    I am going to check my lease later to double check the terms there too.

    Your lease will be the place to get the definitive answer - that you must adhere to.

    Some management cos might offer to give you different terms (e.g. monthly payment) which you are free to accept or reject. But they can only insist on whatever terms are in the lease.
  • energy1x
    energy1x Posts: 77 Forumite
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    Thanks for your reply.

    Checked my lease and I'm staggered - it does indeed state that the rent needs to be paid in advance on demand annually.

    Is it worth asking for a monthly payment?

    It's not a problem of paying, it is more a problem that whenever I decide to sell in future I have to time it so that I do not lose out on paying the service charge benefitting the new buyer/owner of the property!
  • eddddy
    eddddy Posts: 16,443 Forumite
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    energy1x wrote: »
    It's not a problem of paying, it is more a problem that whenever I decide to sell in future I have to time it so that I do not lose out on paying the service charge benefitting the new buyer/owner of the property!

    That won't be a problem.

    If you sell, say, 5 months into the year - your solicitor should ensure that the new owner refunds you 7 months worth of the service charge.


    energy1x wrote: »
    Is it worth asking for a monthly payment?

    You can certainly ask - but I doubt that it will work in the way you expect...

    The full year payment will probably be due in September - but you would pay it over 12 monthly installments.

    So even if you sell in October, you would still owe 11 months worth of installments...

    ... but as I mentioned above, the new owner will refund the 11 months worth to you.
  • Slithery
    Slithery Posts: 6,046 Forumite
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    energy1x wrote: »
    Is this reasonable? From all my friends and family who have ever lived in a leasehold they have always paid either monthly or quarterly. Is this a legal requirement?
    Whereas all the leaseholds that me or my friends have ever lived in have always been due annually, I've always believed that that was the standard position. Just shows to show how relying on a small sample size provides useless data.
  • energy1x
    energy1x Posts: 77 Forumite
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    Slithery wrote: »
    Whereas all the leaseholds that me or my friends have ever lived in have always been due annually, I've always believed that that was the standard position. Just shows to show how relying on a small sample size provides useless data.

    Hence my question, to widen the data sample!

    Thanks for all the replies, given me a wider perspective. I'll ask for monthly payments but I know next to no chance of it
  • wlondoner
    wlondoner Posts: 25 Forumite
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    My service charge is paid monthly

    It would put me off a property paying it annually especially if the amount is high
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