Share of freehold problems

[Eliz]

I really hope someone can help - I am almost ready to exchange but am now struggling with the Share of Freehold business. First my solicitor who is out of London is unfamiliar with the concept - it took him ages to understand that the share we are getting in the management company is what is meant by share of freehold. Now he has come to me and said as the lessee (is that the word? leaseholder...) we have individual responsibility for buildings insurance and also maintenance of the exterior and communal areas. He thinks this is a problem because if the other flat (there is only one other) don't renew their buildings insurance then it would cause problems, as the whole house needs to be covered. Also how would we determine who pays for what in terms of exterior/ communal work? I thought these things would be done jointly through the company we have a share in. We have no clue what is in the other lease for the flat downstairs

My solicitor has never done this before and I am worried he's going to miss things. I could change solictors but I'd have to pay twice now. Can anyone give me some tips on what we need to look out for?

Thanks

[pippaw]

If i were you I'd change to another solicitor as it always worth having one thats got experience in what it is your purchasing, as they would know what to look out for etc. You shouldn't have to pay your current solicitor the full amount they quoted as they would not be carrying out all the work i.e exchange and completion.

Always fully understand your position and your potential neighbours position, with regards to buildings insurance and maintenance. It may be worth writing to the other leaseholder.

[Richard Webster]

if the other flat (there is only one other) don't renew their buildings insurance then it would cause problems, as the whole house needs to be covered.

This can be dealt with by a one-off contingent buildings insurance policy paid for by the seller, who in this market should be greatful he has a buyer!

The lease should divide responsibilities for maintenance between the freeholder company and the individual lessees and it is really a matter of reading the lease and having your solicitor explain it to you.

If your solicitor has to admit he doesn't understand it all then he shouldn't be doing the work for you and accordingly shouldn't charge you for the work done so far, which would not have been to the approrpriate standard.

[Valman]

The lease should provide for all the payments that you are required to pay. It is very rare indeed for a lease to not to provide for buildings insurance! Ask you solicitor to provide a 'Report on title', that I understand is the minimum requirement of the Law Society. Give them a call on what is required by a conveyancing solicitor on 0207 242 1222 - they should tell you what you should expect.

Good luck

Valman

[Richard Webster]

This whole share of freehold business is such a source of confusion that I have produced a website about it: Shared Freehold Flat Info

[New Homes Expert]

You should change solicitors NOW!
The Freeholder pays for buildings insurance not a flat owner.
If you have a 50:50 share you are 50% responsible for the costs.

[Richard Webster]

You should change solicitors NOW!
The Freeholder pays for buildings insurance not a flat owner.
If you have a 50:50 share you are 50% responsible for the costs.

You've read their lease then have you?

It may well normally be the case that the freheolder pays for the buildings insurance but not . I've seen plenty of leases, and have one in front of me right now - of a 1970s maisonette - where the lessee of each maisonette has to insure his part of the building.

May not be ideal, but there it is.

[Dan S]

Dealing with Freehold and Leasehold is probably the number one source of confusion when buying property. It's a shame the solicitor can't deal with the issues properly.

[New Homes Expert]

Originally Posted by Richard Webster

You've read their lease then have you?

It may well normally be the case that the freheolder pays for the buildings insurance but not . I've seen plenty of leases, and have one in front of me right now - of a 1970s maisonette - where the lessee of each maisonette has to insure his part of the building.

May not be ideal, but there it is.

So what are you saying, each flat insures their part of the building?
I cant see anyone getting a mortgage on a leasehold like that!

I suppose the flat on the top floor is responsible for the roof and the ground floor flat responsible for the foundations!

[Richard Webster]

Quote:
Originally Posted by Richard Webster
You've read their lease then have you?

It may well normally be the case that the freheolder pays for the buildings insurance but not . I've seen plenty of leases, and have one in front of me right now - of a 1970s maisonette - where the lessee of each maisonette has to insure his part of the building.

May not be ideal, but there it is.
So what are you saying, each flat insures their part of the building?
I cant see anyone getting a mortgage on a leasehold like that!

I suppose the flat on the top floor is responsible for the roof and the ground floor flat responsible for the foundations!
__________________

There must be thousands of maisonettes all over the country with this set up and it hasn't stopped them being sold and mortgaged!