I have a lender prepared to lend on a 27 year lease, but....

[imranhussain247]

Hi,

I have a lender who is prepared to lend on a flat in SE london, which has only a 27 year lease. However the problem I have is that the lender wants confirmation from the freeholder of how much he is willing to accept as a premium and how long they are prepared to extend the lease for.

What I need to know is whether a section 42 has this information contanined in it? The seller is prepared to serve the notice and assign it to me.

Some other points that you may want to know is that the Freeholder is a local authority, and it has a head leasholder.

Can any one help?

Regards
Imran

[sgclacy]

When you serve a section 42 Notice you are putting forward an offer to the freeholder. The freeholder can accept it or as most likely reject it and appoint a valuer to calculate the premium. By serving the Section 42 Notice the lessee becomes liable for the landlords costs of checking the validity and also the valuers costs.

expect to pay around 34% of what the flat would be worth if it has a very long lease and a peppercorn rent

[imranhussain247]

Hi,

So how long would it take for a counter notice to be served?

Regards

Imran

[sgclacy]

Hi,

So how long would it take for a counter notice to be served?

Regards

Imran

They have a period of upto 2 months from the date you serve the notice

[jeffrey]

The only party who can serve a s.42 Notice is the existing lessee (and, even then, only if he/she has owned leasehold for > 2 yrs.)

[imranhussain247]

Thanks for your speed response. I heard that a counter notice has to be served within the time frame specified in the Section 42 notice submitted by the leasee. So if the section 42 states that a counter notice has to be submitted within 14 days they have to respond within that time period.

Is that just a rumour or is there some substance to it?

I have confirmation from the sellers solicitors that they are in a position to serve a section 42 and that they meet all the criteria.

Regards

Imran

[jeffrey]

Once T serves s.42 Notice, L has at least two months [not 'two weeks'] to reply. See s.42(3)(f) and s.45(1) re exactly how long.