Unfair fees for Deed of covenant after 18years of renting my flat

Unfair fees for Deed of covenant after 18years of renting my flat

5:41 AM, 20th May 2015, About 10 years ago 35

Text Size

I have been renting my flat for 18years without any need for a deed of covenant. I with other owners have a share of the Freehold of the building.

All of a sudden company directors(owners who have put themselves forward as directors) are asking for a £150.00 +VAT for deed of covenant for each new tenant.

-Firstly this is a huge amount of money for a few pages of paper, which can be printed in no time and may be 10minutes of administration time.

-Secondly, they want my tenant to sign the deed of the covenant and not me the owner.

-Third thing is that no one ever asked for a deed of covenant before, although I have been told that this is in my deeds.

-Also the contents of the proposed deed of covenant seems to be relevant to both myself and my tenant,

– In addition my tenant has been there for a while and might not want to sign the deed of covenant in the middle of their tenancy.

I have asked the property manager to remove some of the clause and he has emailed me back agreeing to this!

Can they ask for so much money after such a long time, and ask my tenant to sign it?

I am totally confused and stressed out by this. The building manager is now bullying me and telling me that if I do not sign their deed of covenant, they will take me to court, I will loose my flat and I have to pay all their costs or I can pay £900.00+VAT to their solicitor to do a separate deed of covenant for me.

I appreciate any help and advice, as I have no idea how to go about this and I am getting desperate.

Thanks

Ovalunfair fee


Share This Article


Comments

Maria M.

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

17:45 PM, 25th July 2015, About 9 years ago

Thank you for all the info. It is absolutely great.

What is the best way to approach lease extension in general? Is it best to approach the Freeholders/ Management company informally or is it best to get a solicitor to approach the Freeholders/ Management company Formally?

I have looked at the Leasehold advice website and have got a rough idea of how much the lease should cost me. Although I understand this is not an accurate figure and it is just a guide line.

I am hoping to get copies of the my lease& plans and copies of Freehold titles & plans and read them, have an understanding of terms of the lease. I am then thinking to approach the Freeholders informally and ask for 90 years statutory+ Pepper corn ground rent. If Freeholders figures are in line with Leasehold Advisory service, then pass it on to a solicitor. Am I being foolish here?

Or should I call a RICS/ALEP registered surveyor and get a solicitor specialising in Lease Extension and pay them their negotiation fees etc?

This is all to save some money on solicitors fees, etc, as I understand that I have to pay the freeholders surveyors fees and legal costs. Is this worth or am I playing with fire here?

What is your experience of this ? or is this a mammoth task that only experts should be dealing with?

Any advice would be greatly appreciated.

Maria M.

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

17:49 PM, 25th July 2015, About 9 years ago

Thank you for all the info. It is absolutely great.

What is the best way to approach lease extension in general? Is it best to approach the Freeholders/ Management company informally or is it best to get a solicitor to approach the Freeholders/ Management company Formally?

I have looked at the Leasehold advice website and have got a rough idea of how much the lease should cost me. Although I understand this is not an accurate figure and it is just a guide line.

I am hoping to get copies of the my lease& plans and copies of Freehold titles & plans and read them, have an understanding of terms of the lease. I am then thinking to approach the Freeholders informally and ask for 90 years statutory+ Pepper corn ground rent. If Freeholders figures are in line with Leasehold Advisory service, then pass it on to a solicitor. Am I being foolish here?

Or should I call a RICS/ALEP registered surveyor and get a solicitor specialising in Lease Extension and pay them their negotiation fees etc?

This is all to save some money on solicitors fees, etc, as I understand that I have to pay the freeholders surveyors fees and legal costs. Is this worth or am I playing with fire here?

What is your experience of this ? or is this a mammoth task that only experts should be dealing with?

Maria M.

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

17:49 PM, 25th July 2015, About 9 years ago

Thank you for all the info. It is absolutely great.

What is the best way to approach lease extension in general? Is it best to approach the Freeholders/ Management company informally or is it best to get a solicitor to approach the Freeholders/ Management company Formally?

S.E. Landlord

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

19:02 PM, 25th July 2015, About 9 years ago

I am puzzled by some of the comments above as they appear to suggest the lease for which the extension is required is not the one where you have a share of the freehold. To reiterate previous comment if you have a share of the freehold you are unlikely to have to pay a premium to extend the lease.

If you are referring to a different flat and lease where you do not have a share of the freehold then a different process will apply.

It is likely that there will be various views as to if to deal with it formally or informally but I would probably, in the first instance, ask the freeholder what their process is for lease extensions and then make a decision from there.

If you decide to go the formal route I would expect to instruct a solicitor and a surveyor specialising in lease extensions. The surveyor to advise what the premium should be and then for the solicitor to serve the formal notice. I expect the freeholder will then ask you to pay for their surveyor to advise what the premium should be and if similar to yours an agreement reached, if not then for some negotiation (possibly via the surveyor who prepared your valuation) and if an agreement cannot be reached for it to be referred to the LVT.

There are time limits if a formal notice is served and you should take advice from a solicitor familiar with lease extensions.

If not following the statutory route your freeholder may ask for an increase in the ground rent.

It is an area where you should take professional advice.

I suggest you also start a thread on lease extensions for a wider view on the subject.

Maria M.

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

8:47 AM, 26th July 2015, About 9 years ago

Thanks a lot. Yes I have another flat with 56 years lease left and in this I do not have a share of the Freehold and Thanks again, I have started a Thread on lease extension. But thanks again for sharing your knowledge on this subject.

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership

or

Don't have an account? Sign Up

Landlord Automated Assistant Read More