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Extending Your Lease Or Buying The Freehold: If The Freeholder Is Unresponsive



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By : Andy Szebeni    99 or more times read
Maybe you would like to extend the period of the lease, maybe you as well as a group of neighbours express a desire to purchase the freehold, perhaps you will have concerns with the management of the development and also freeholder controls the upkeep or possibly you could have a difficulty with the ground rent.

Maybe the freeholder is not responding to your efforts to get in touch with them. It is surprisingly common for leaseholders of residential property to phone, write or email their freeholder and to obtain no answer. A standard time for this to get exposed is as soon as buyers or sellers of apartments have to supply proof of the buildings cover of their block. This is usually arranged through the freeholder (check the lease record to confirm whose obligation it should be) and it is their obligation to prove to a lender that the block is adequately insured.

The primary thing to bear in mind is that the law is on your side. The next thing is, for those who have tried each potential approach to get in touch with the freeholder, there is generally a way that the system permits you to get the result that you want, be that a lease extension, freehold acquisition or Right to Manage (RTM). Perhaps the freehold is owned by someone and they could have died. Otherwise they have moved and not informed the Land Registry of their new address, as is their obligation. Another option is that you have not been offered the right of first refusal when a freehold title was sold. This is unlawful and for 18 months you have got the right to turn over the sale or purchase it yourself.

If your landlord tells you they sold the freehold to someone else, even if the original landlord’s details are on the Title, then legally they are still the landlord. It is always their legal obligation to make sure the document is up to date.

One of the reasons you could possibly be struggling to get in touch with the freeholder is that the company could have ceased to trade, gone into bankruptcy, entered administration or even been struck off by Companies House.

If the freehold was held by a company, you could have found that the assets of the freehold company have passed to the Crown. The Treasury Solicitor will then almost surely be happy to sell the freehold to you and your neighbours at the open market value, in other words the amount that a freeholder could sell the freehold at an auction. The eventual rate is down to you to negotiate.

If the company is in receivership or administration you may serve the notice on the administrator or official receiver. If bankruptcy applies then there will be a trustee upon which to serve the required notice or for you to contact.

If your best efforts throw up a blank and you and your fellow lessees cannot find the freeholder (a situation often known as an absent landlord or absentee landlord) then you can consider obtaining a Vesting Order through a County Court.

First you have to obtain legally acceptable valuation of the freehold. You should use a knowledgeable and credible surveyor having a specialism in Leasehold Enfranchisement. You may find problems with another type of surveyor and yow will discover a quality, vetted and experience local valuer using the surveyor search on the web site of the Association of Leasehold Enfranchisement Practitioners (ALEP).

When you have the Vesting Order, you may then apply to the Leasehold Valuation Tribunal (LVT) for them to establish the cost to you to acquire the freehold. The process is prescribed in Section 26 of the Leasehold Reform and Urban Development Act for freehold acquisition or Section 50 for lease extensions. You should be able to buy the freehold much cheaper than if you COULD find your freeholder, since the LVT will consider your ‘offer’ price. Since there is no counter offer, so long as your initial offer is reasonable, you could pay the applicable County Court the agreed amount and start the process of purchasing your freehold. The money then goes to the freeholder if they turn up.

You can ask a solicitor, surveyor or intermediary to undertake the detective work for you. However, there is substantial leg work and you will save a lot of money doing it yourself. However, you can find many pitfalls to negotiate therefore you will require patience and resolve.
Andy Szebeni is part of the management team of the Association of Leasehold Enfranchisement Practitioners. ALEP has more than 100 members, each vetted before joining. They include solicitors, surveyors, intermediaries, managing agents and other professionals in England and Wales specialising in the field of leasehold enfranchisement. Have a look at the searchable list of vetted members at www.alep.org.uk/membership.

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