Missing lease document

by Readers Question

16:10 PM, 1st June 2015
About 3 years ago

Missing lease document

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Missing lease document

I have been in a process of buying my first BTL. Missing lease document

All was going well up until this last week of exchange of contracts but the seller solicitors have informed that there are no lease documents governing the property.

My solicitor is now in negotiation with the seller to pay for indemnity insurance and also in touch with my mortgage lender to see if that’s OKwith them. My solicitor also said ” Although we don’t have a copy of lease, we do have title deeds from the land registry that confirms that there is 143 years left on the lease of property”

Now my concern is, will it be difficult in selling this property in near future if I wanted to?

Also, in case we decide to extend the lease in future, will that be possible without these papers?

Should I hold my horses to buy this property given the fact all papers are not in place.

Please advise.

Thanks

Kaps



Comments

Mark Alexander

16:19 PM, 1st June 2015
About 3 years ago

You are asking all the right questions, however, they should be addressed to your solicitor.

My advice is do nothing without your solicitors written advice.

It doesn’t sound good though. If I were to hazard a guess I would say that it is likely that you are dealing with an absent or bankrupt freeholder scenario. If that is the case it is highly likely that your solicitor will end up advising you to abort the transaction.
.

patrick maher

16:55 PM, 1st June 2015
About 3 years ago

It seems strange that the Land Registry have a record of the length of the lease but not a copy of the actual lease. However with indemnity insurance I do not think there will be a problem as long as your lender and solicitor advise you there isn't one. I imagine the solicitor feels it isn't a problem so long as the lender agrees. But why would you want to extend a lease that has 143 years left? It won't start losing value for about 60 years.

money manager

17:25 PM, 1st June 2015
About 3 years ago

The right course of action might partly depend on the type of property. An absent landlord isn't entirely a bar but questions need to be posed such as who manages the repair and insurance,or who will enforce covenants against other leaseholders (i.e. is this a multi unit block, larger development, or just a standalone property). Either way, it is possible for the, or all the, mutual leaseholders collectively, to purchase the freehold through court process. The value of say a 143 year remaining lease on a modern block obviosuly has considerable greater value than one on say a converted flat in a house with a lease of 999.

Ian Ringrose

18:55 PM, 1st June 2015
About 3 years ago

What about when you want a new mortgage in a few year time, will the new lender be happy....

What if the lease turns up and says you can't rent the property out.....

Anthony Endsor

19:17 PM, 1st June 2015
About 3 years ago

Having come this far and presumably paid survey and solicitor search fees, etc, I would think you would be very reluctant to abort the transaction at this late stage. Likewise I'm sure the seller would be unhappy to lose the sale over a matter which would obviously crop up again with another buyer.
It is very important this is sorted out before you exchange, so you need to speak to your solicitor and insist a copy of lease is found from somewhere.
I wouldn't be happy to exchange without this if I was buying, and I'm sure when the seller sees there is a chance you would pull out, they will do all they can to help.

money manager

19:59 PM, 1st June 2015
About 3 years ago

Presumably you have identified the landlord from the title document? Are they not traceable from that?

kaps z

20:06 PM, 1st June 2015
About 3 years ago

Hi, thank you everyone for your advise.
I did called solicitor today and they confirmed and they mentioned "Buyer got confused as we asked them upper flat lease document and ground floor lease document. They have confirmed us that they will send the flat (ground floor) lease document but they don't have upper flat lease doc"

Just to clarify I am buying ground floor flat and I asked th solicitor why you asked for first floor flat lease doc and solicitor replied that we sometimes ask for it to reference and to compare if they are similar ?.
So far solicitor mentioned it's looking ok and not to worry but now i am confused about comparing or referencing flat's own lease with other flat in same development, is that normal ? He mentioned that they are linked to each other which again I couldnot understand.
Although I will be speaking to them again and get this clarified as I am running with lot of confusion but anyone of you has faced any such thing?

patrick maher

9:09 AM, 2nd June 2015
About 3 years ago

Reply to the comment left by "kaps z" at "01/06/2015 - 20:06":

I can't see the reason for looking at the lease of the other flat. All your rights and obligations would surely be set out in your lease. Ask him why he needs to know whether they are similar & what would happen if they were not, and why he only compares them sometimes.

Ian Ringrose

9:16 AM, 2nd June 2015
About 3 years ago

A very basic example, if your lease says "no dogs" but the other flats lease does not.....

Without seeing the other lease you may think there there will be no dogs.

Then think about repairs, what if your lease says you must pay half the cost, but the other flats lease says they must pay 1/3 the cost, and there are only two flats....

patrick maher

9:51 AM, 2nd June 2015
About 3 years ago

Reply to the comment left by "Ian Ringrose" at "02/06/2015 - 09:16":

Ian,
So does this mean that every lease in a block should be examined?! And if you were buying a lease in a block of 3 and your lease said you had to pay half the costs wouldn't you think this was unreasonable anyway?

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