Covid-19 Bounce Back loans for property businesses16:06 PM, 5th May 2020
About 3 weeks ago 46
I have inherited a situation I don’t fully understand and wonder if anyone can clarify how things should work please. I am not familiar with running a company and all that entails.
I own 3 leasehold flats in a block of 4. There is a Ltd management company that owns the Freehold and I own all 4 shares in this company. There is a bank account in this companies name into which the maintenance charge is paid. The leases don’t allow for a sinking fund. The owner of flat 4 wants to renew his lease. The lease has been valued and we are about to agree a price for a 90 yr extension. If lease no. 4 is extended and updated and I extend and update my 3 leases (and get a better LTV) what becomes of the freehold?
If I need to sell a/the flat(s) and the residual value is consolidated by some unscrupulous mortgage company, maybe it would be better not to extend my 3 leases so that the value would sit outside the value of my flats?
Is this the best structure to manage the flats or can it be done another way without having to run a company and dedicated bank account? Can I charge a service charge for the work I put in?
Any advice/comments/possible pitfalls would be greatly appreciated.
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