Problems with freeholders brought to light by conveyancing process

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    Problems with freeholders brought to light by conveyancing process

    I hope I have posted this in the right topic. We are currently in the process of selling a leasehold flat. The landlord manages it through a managing agent but they're essentially the same people if you look at the list of officers on the companies house website. The process is right at the end and I'm pretty sure our buyers are now going to pull out due to the following issues:

    1) The landlord/managing agent is refusing to provide an adequate statement of accounts showing what we've paid them and what has been allocated to our flat. They've provided a statement of account of sorts but according to the buyer's solicitor this is not adequate.

    2) By the terms of our lease the landlord is apparently required to have a reserve fund and no such fund exists.

    Neither of these issues were raised when we bought the flat 5 years ago which leads me to think our own solicitors must have been remiss.

    What are our options here? Is there anything we can offer the buyers (money off etc) to try to get the sale through?

    #2
    It is a rare lease that REQUIRES a reserve fund. Most simply permit one. What does it say exactly.

    Unfortunately freeholders can easily reduce the value of properties by making them hard to sell and then buying themselves eventually. It is a type of theft that is made easy by the legislative and intellectual vacuum that is leasehold law. There is no requirement that they provide honest (or any) answers to permit sales. Imprisonment for stealing from lessees, breaking the law or causing lethal risks to lessees is as rare as hen's teeth.

    Comment


      #3
      Thank you. It definitely says there has to be one. It says

      "That the landlord maintains a reserve fund in accordance with the 6th schedule"

      And then the 6th schedule itself is attached as a photo here.

      Comment


        #4
        Originally posted by ripeepeep View Post
        1) The landlord/managing agent is refusing to provide an adequate statement of accounts showing what we've paid them and what has been allocated to our flat. They've provided a statement of account of sorts but according to the buyer's solicitor this is not adequate.
        It is not usual to divulge personal accounts of leaseholders to strangers.
        The questions asked are "Are the service charges paid and up to date. The seller answers -Yes or no.
        A Yes is perfectly acceptable to a buyer
        Originally posted by ripeepeep
        2) By the terms of our lease the landlord is apparently required to have a reserve fund and no such fund exists.
        My answer to the reserve fund would be ( An assumption )
        There are no major repairs needed to the roof and foundations forseeable in the next 10 years, therefore there is no need to fund an item that does not need major works to be done in the next 10 years.
        Decorating is fine at present.
        And assuming the above statements will hold up.

        Comment


          #5
          Thank you. I certainly hope so but the buyer's solicitor appears to be holding firm!

          Comment


            #6
            Originally posted by ripeepeep View Post
            Thank you. It definitely says there has to be one. It says...
            As RAM indicates this does not oblige that there is a reserve fund, unless there is a purpose (under the lease) for such a fund in some reasonable timescale.

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