Freeholder demanding extortionate fees for notice of remortgage

[eagle2]

It looks like by accepting the terms of the lease, you have agreed to pay a minimum charge of £35 plus VAT and a higher fee as long as it is reasonable. What is the date of the lease? What was the inflation adjusted equivalent at the time of your remortgage?

I do not recommend ignoring a balance recorded as owing according to the freeholder. Firstly it will be carried forward and shown as arrears until you try to sell. Also if you make future payments, the chances are that they will be allocated to this balance no matter how clearly you specify your intentions at the time. Finally, as you state, there are likely to be additional charges imposed by the freeholder.

The freeholder should have a complaints procedure which you may wish to follow. Alternatively, the lease may state how disputes should be resolved. You could also suggest some form of mediation. For the amount involved, it is not worth applying to court or to the FTT and if you do not succeed, you could be ordered to pay the freeholder's costs which would exceed the amount of your claim.

I suggest that you make an offer to pay an amount to the freeholder "wiithout prejudice subject to costs" in order to demonstrate reasonableness on your part and protect yourself in case the freeholder takes legal action against you, which is unlikely,.

[EssexLL]

Hi,

I know similar issues have been posted before but thought it best to start a new thread with all specifics as every case/lease is different. Forgive the long post; I thought it best to include as much relevant info as possible.

I recently remortgaged my leasehold flat with a new lender. The lender's conveyancer sent their "standard fee" of £30 + VAT to the freeholder (which I have paid the conveyancer) but I have received a letter from the conveyancer saying that the freeholder is asking for an additional £84 (i.e. total of £120) and will not receipt the notice of mortgage without it. Unhelpfully the conveyancer did not actually enclose the letter they received from the freeholder and are not responding to my requests to send it. My remortgage has completed and it seems the conveyancer is washing their hands of the situation.

My freeholder, Freehold Managers PLC have an online portal which is showing an amount owed of £36 for "PropTran: Notice of Mortgage" (interestingly, the same amount already paid by the conveyancer and less than the amount asked in the letter) and I have received an automated arrears notice for the same amount. Their automated payment system does not allow any amount to be paid other than the balance showed.

According to my lease I need to pay a "reasonable fee being not less than Thirty Five Pounds (£35) (plus VAT) in respect of each document or instrument so produced."

The only way of contacting the freeholder is through their online contact form, which I have done, stating that according to my lease the balance owed is only £5 + VAT (since the conveyancer already paid (£30 + VAT) and requesting that the account is updated so I can pay the correct amount, but I have not received a response over 1 week on.

I have also contacted the Leasehold Advisory Service and their response is as follows:

"Having reviewed your lease....My interpretation is that this means that your landlord cannot charge you anything less than £35+ VAT, but they can charge more than this.

You can make a complaint to your landlord about the amount of registration fee that they have requested and try to negotiate a lower fee. It may be advisable to find out how much other Landlord’s charge for registration fees.

In Proxima GR Properties Ltd v McGhee - [2014] 2 EGLR 27, it was held that this fee was a registration fee and not an administration charge as it does not fall within the definition of administration charge under Paragraph 1(1) of Schedule 11 to the Commonhold and Leasehold Reform Act 2002.

As it is not an administration charge, it is not possible to challenge the registration fee at the First-Tier Tribunal (Property Chamber); however, it may be possible to challenge through the County Court. I would advise seeking advice from a litigation solicitor on the merits of taking any legal action."

I find this unhelpful as the case quoted refers to the LVT which no longer exists and I have read on here similar cases where the First Tier Tribunal did deal with this kind of case so I don't feel it is entirely correct. I also fail to see the merit of finding out how much other landlords charge for registration fees as they are notorious for demanding extortionate fees way in excess of what is in the lease, so this would not be an accurate way to determine what is "reasonable."

My questions are:

• Does the phrase "Not less than" mean the freeholder can indeed increase this charge or is this just legal jargon? Even is they can increase this charge, it must still be "reasonable" and in my opinion, £120 is clearly not reasonable
• What should be my next steps? I have no intention of sucking up extortionate fees every time I remortgage. Given my remortgage has completed, can I ignore this, given I have made every effort to engage the freeholder and pay what I believe is owed by my lease? I assume eventually that they would issue late payment fees and interest, possibly legal fees. Could these be ignored too?
• If don't ignore it and go to FTT there is a £100 fee which is not refundable. Are there any other charges I need to be aware of? e.g. freeholder's legal fees etc?

Thanks in advance,