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Buyers want us to extend lease on freehold property. Is this really necessary?!

(3 Posts)
aufaniae Fri 05-Oct-12 14:30:11

I suspect this comes from the mortgage provider and is box-ticking.

We bought the freehold out on the flat some time ago. There are three flats in the property, we went through a process called "collective enfranchisement" and now the freehold is owned by a company we set up, each owner is a director of the company and owns their share of the freehold via the company.

I have just found out that the original lease still stands (I didn't realise this), and we are just a few months short of the 75 years the mortgage company (I assume it's them) finds acceptable.

However I think it's unfair that they're treating the property as if it's a standard leasehold property. If it was leasehold, it would cost thousands to extend the lease, and you'd have to involve the management company. In our case, it costs only solicitors fees, and you don't have to involve any external organisations.

Should they be demanding this from us?

It's come late into the sale and it a total surprise, the solicitors fees for it are the best part of £500 which I simply do not have. (This is a very difficult time for us financially. Just staying afloat is a struggle at the moment)

I don't know what to do.

If anyone else has any advice or has experienced similar I'd be very keen to hear from you smile

(I have also posted this in property and was advices to post here also)

cestlavielife Fri 05-Oct-12 16:07:01

thing is a new leasholder might need to wait two years before they have right to extend lease - so you could agree to do this but have them pay for it?

my buyers of leashold flat paid for the lease extension as part of the buying price - i started the process but they paid for it so the lease extension and sale was completed on same day using same lawyers . complex but it can be done.

aufaniae Fri 05-Oct-12 16:21:18

OK, just spoke to these people who were great (took ages to get through, but hey, it's free legal advice, great!) Leasehold Advisory Service

They explained that it is applicable to us as I have two separate roles: the freeholder and the leaseholder. I may be selling my share of the freehold as part of the sale but that's not what concerns the mortgage lender, they're just interested in the lease.

Bum!

FWIW the 2 year thing only applies if you're dealing with a management company. The law says you have a right to extending the lease after owning for 2 years. That doesn't mean you can't do it earlier if the owner of the freehold agrees. (In this case, me and the other two owners).

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