I would really appreciate your opinions, as I am in the process of purchasing a ground floor maisonette (leasehold). The lease is for 900 years, with a ground rent of £5 per year. My solicitor says we can complete the transaction with an indemnity policy. This policy is due to the unclear division of responsibilities regarding repairs and maintenance.
The upper maisonette had a deed of variation done in 2003, which states that they are responsible for the roof. Initially, I told my solicitor to proceed with the indemnity policy and complete the purchase, as I am under time pressure (my mortgage offer expires on 20th October). However, I later changed my mind and decided that I do not want to complete the purchase without a deed of variation.
My solicitor presented me with three options:
- Indemnity policy only,
- Indemnity policy, complete the purchase, and then start the deed of variation process,
- Deed of variation first, then complete the purchase.
I will cover the costs of the deed of variation, and I am aware of this and fine with it. What causes me great stress and sleepless nights is whether I made the right decision to wait for the deed of variation, which most likely means having to reapply for the mortgage.
I am also very worried about what might happen if the freeholder wants to change the ground rent in the deed of variation, for example, to a doubling ground rent every few decades (as it happened in the upper maisonette’s deed of variation), which I understand would be disadvantageous for me. I am afraid this could become their condition for clarifying my responsibilities regarding repairs.
What should I do in such a situation? I would also like to mention that I plan to live in this property for about 10 years.
I would be very grateful for any suggestions, advice, or points I should pay attention to when arranging the deed of variation.