Absent freeholder

[Starstella21]

We bought our first floor leasehold flat (currently 115 years left on lease) in 2014 as FTB, the flat is in a converted house with one other flat underneath us also privately owned.
Our freeholder sold us the flat, they did the conversation in 2004. Since our purchase we have had minimal communication from the freeholder, our ground rent has been collected once in 2017 and they have basically done nothing to upkeep the property although it is not in any major disrepair.

In February 2020 we put the flat up for sale and received multiple offers, Covid hit in March and the buyer lost their nerve due to pandemic around June. Back to market and sold again in July, it became apparent during the solicitors process that our named freeholder had actually died in 2018 and no probate had been been applied for.
The freeholders husband has continued to insure the building (we have paid all outstanding ground rent and BI owed now) but he apparently has no interest in applying for probate as our freehold is the only asset that needs applying for. According to the freeholders solicitor she has encouraged him to do this but he has no interest (he is quite elderly in his 80s).

So our second buyers pulled out. We were advised by solicitors that our sale would be proceed-able with an indemnity for absent freeholder.
EA happy to go back to market and all potential buyers informed of this arrangement when viewing/offering and price reduced by to reflect this, we accept an offer in December and eventually due to exchange today, all enquires resolved and happy buyer as of end of last week.

We received a call from the agent yesterday afternoon informing us that the buyer will not proceed until probate has been applied for. We have gone back and offered additional money off as we are absolutely desperate.

We are now unexpectedly pregnant with our third child and have to get out of our flat hence our desperation. It will not be feasible to stay in our current home due to lack of space. Our acting landlord knows all this and still doesn’t wish to apply for probate, he basically is totally disinterested.

I really need some advice on what we can do.
Our agents said that if the buyers don’t proceed (looks unlikely) he will see if he can approach any investors etc as an option.

We have also looked at renting our place out and renting somewhere ourselves whilst we try and resolve the freehold Issue with we think a compulsory purchase order via the courts?
We have also considered auction as we are so desperate to be free of this place.
We have about 100k equity in the property currently.

I can’t get an appointment with the lease advisory service for another month. I think we will approach a solicitor next week for advice but we feel totally trapped.
Thank you

We are in the same situation, but not looking at selling at the moment, I know it could be an issue. The freeholder is absentee, beloved dead abroad (he was a foreign National). We were advised to apply for share of freehold with the people below ( it’s a maisonette , so 2 flats). That would resolve the absentee freeholder issue. Could you do this?

We had a supposedly absentee freeholder - it caused a lot of problems with the purchase. In fact he wasn’t actually absent, just hiding a few miles away under another name, because of debts attached to the FH.

Same as @whataboutbob, it was one maisonette of 2, but the other LHolder didn’t want to buy her share, so we bought the whole.

Even after we’d traced the FHolder he still pretended it wasn’t him until the purchase was well under way, when of course he popped up, having realised that there was going to be money in it.

Hi @GETTINGLIKEMYMOTHER. Can I ask how difficult it was to buy the freehold without the other leaseholder being involved? I’ve also suggested it but they’re not interested either. I didn’t know we could do it on our own.

Thanks all and yes agree @GETTINGLIKEMYMOTHER if you could give any details about how you go about doing this as we are also concerned this may be an issue, our neighbours seem unconcerned at present but I wonder if they actually realise the scale of the issue.

I think we are going to approach the freeholders spouse and offer a cash incentive to apply for the freehold/probate as a first option. We will have to just rent in between this process.

Hello again.

Having asked the other flat owner if she wanted to go halves, and she didn’t, it wasn’t a problem to buy the whole - after all, our supposedly absentee bloke* had been the Fholder of both. It did of course make it twice as expensive, though.

I do absolutely recommend using a specialist solicitor! We started off with the high street sol who’d handled the purchase but he was frankly useless. We ended up using Ringley Legal, who were based in London - I hope they’re still going, but if not there are bound to be others - there are so many LH properties in London and apparently an absentee Fholder is not uncommon.

It did all take quite a while, partly because of Mr Supposedly Absent buggering us about, and only popping up after it was going ahead as an absentee case.

The cost of the FH is BTW worked out according to a formula taking into account current value of the property, ground rent, etc. The FHolder can’t just ask what they like. Plus of course there are the legal fees, but ours were fairly reasonable. It was finalised in a court session, which we and the sol. attended - finally tied up after a year or so.

It was all something of a PITA at the time, but I’m really glad we did it - it’ll save any problems with a future sale, plus it means we wouldn’t need anyone else’s permission (except council planning) if e.g. we decided to convert the loft space, which we did think of at one point.

Might add that the owner of the lower flat decided to sell while we were going through the motions, and having no clearly named FHolder caused problems there, too, but once we’d informed their sol. that is was going ahead - our sol put it in writing IIRC - they seemed satisfied.

*He was the owner of the upper flat before selling it to our vendor, who hadn’t heard from him or received any ground rent demands for several years. But the so and so still insisted that he’d submitted invoices and hadn’t been paid - a blatant lie - and by law we had to cough up IIRC 7 years of back ground rent, but thankfully it wasn’t a huge amount.

I hope this is helpful but do feel free to ask if there’s anything else.

@GETTINGLIKEMYMOTHER that is so helpful thank you so much ☺️
We are in london so we will definitely look the solicitors you used up also. I am really hoping our downstairs neighbor will be up for sorting it together 🤞
I have anticipated about a year and think we will just rent our place out in between and rent ourselves so we have more space.
I would definitely have sorted this all out first if I had known the toll it would have taken mentally trying to sell with the absent freeholder. Xx

Thank you, so helpful and something I need to get to grips with as we’re planning on moving in the next 4 years or so, I will certainly take you experience and advice into account.