Ground Rent/Maintenance fees on leasehold property.

[ReallyCantThinkOfOne]

Hi everyone,

I am new to this forum.

I am HOPING you can give me some advice that can help me.

 

I am 68 years old and I currently own a leasehold property for which I have to pay (extortionate) monthly fees for Ground rent and Maintenance to a management company. During 2020, I managed to pay only for 6 months and then ended up in financial difficulty due to Covid. I was barely able to make ends meet.

 

I stopped paying the maintenance fees around June 2020. My plan was to pay them a lump sum at the end of the year, when things go back to normal and my financial situation improved. Government advised things would go back to normal but unfortunately this didn't happen and I ended up in a lot of debt. I even had to sell my car to pay back money I had borrowed from family members.

 

I live alone and this whole pandemic situation has really affected me mentally. To make matters worse, because I wasn't able to pay the lump sum as I originally had planned, the management company consulted a solicitor (Realty Law) to help them recover this outstanding debt. The initial debt was £596.00 + £36.15 for interest (no idea where this interest came from). The solicitors have now added on legal fees of £721.50 increasing the total debt to £1353.65. I contacted them via email and offered to pay £50 a month for the time being until I can improve my financial situation, at which point I would pay them more. Their response was the following:

'Our client has advised that they cannot honour a payment plan for that duration and therefore we have been instructed to continue our recovery process and request judgment if payment has not been made by 2pm on 29^th October 2021.

As such, we request that you please make full payment of £1353.65 as per the attached arrears schedule by 2pm on 29^th October 2021. If payment or correspondence has not been received by then, then we shall be continuing with further recovery action and issuing a county court judgement (CCJ) which will incur additional fees.

You are entitled to seek your own legal advice.'
 

The whole idea of court proceedings and CCJs and ADDITIONAL FEES has really elevated my anxiety levels to the point I am struggling to get to sleep at night. I borrowed money from family members and used some money that I had saved to pay off the initial £596.00, but its not possible for me to come up with the £700+ for the solicitor fees by 29th October. How is it even acceptable to charge someone £700+ in legal fees for a few letters? 

 

Can someone please give me some advise on what on earth to do or who on earth I can speak to. I am desperate here. 

Any advice would be greatly appreciated.

Thank you in advance
 

[unclebulgaria67]

So they have not actually issued a Court claim yet ? If they did that, then it would enable you time to seek advice, defend, go through mediation and then come to an affordable repayment arrangement. They are just trying to frighten you into finding ways to come up with money to pay them.

 

In regard to Solicitors/legal fees, you would need to check the leasehold agreement, which should include details of the ground rent/maintenance arrangement with a management company. The leasehold agreement you sign may make you liable for reasonable legal fees incurred by the management company. 

 

If you can afford to pay the ground rent element, then that might be a sensible thing to do and pay this to the management company directly.

 

Do you have financial breakdown information showing how much is ground rent, what the maintenance fees cover, how much is management companies fees etc? You are entitled to this information, so should ask the management company for it.

 

Have you contacted your local Council Authority about help available ? Depending on your financial situation, there may be help available.  Government  have provided Councils with extra money to help those who have suffered financially because of Covid. There are discretionary Housing funds that you can apply for.

 

 

 

 

 

[ReallyCantThinkOfOne]

On 28/10/2021 at 06:28, unclebulgaria67 said:

So they have not actually issued a Court claim yet ? If they did that, then it would enable you time to seek advice, defend, go through mediation and then come to an affordable repayment arrangement. They are just trying to frighten you into finding ways to come up with money to pay them.

 

In regard to Solicitors/legal fees, you would need to check the leasehold agreement, which should include details of the ground rent/maintenance arrangement with a management company. The leasehold agreement you sign may make you liable for reasonable legal fees incurred by the management company. 

 

If you can afford to pay the ground rent element, then that might be a sensible thing to do and pay this to the management company directly.

 

Do you have financial breakdown information showing how much is ground rent, what the maintenance fees cover, how much is management companies fees etc? You are entitled to this information, so should ask the management company for it.

 

Have you contacted your local Council Authority about help available ? Depending on your financial situation, there may be help available.  Government  have provided Councils with extra money to help those who have suffered financially because of Covid. There are discretionary Housing funds that you can apply for.

 

 

 

 

 

First of all, I just want to thank you for taking the time out and responding to my message. I really appreciate this.

 

Not issued a court claim yet, but are threatening to take me to court. I haven't currently got a copy of the leasehold agreement, but £700+ in legal fees for a debt that was £596 doesn't seem reasonable to me. I have paid the £596, which was the initial debt before legal fees were added on. Unfortunately I have paid this directly to the solicitors before I saw your message. Do you think the solicitors will take me to court for the legal fees? If yes, what is the likelihood of the judge ruling in their favour, and me ending up in even more debt?

 

I have not contacted the council authority, but I will definitely look into this.

 

 

[unclebulgaria67]

Suggest that you tell the management company that you have paid the Solicitors the £596 relating to ground rent/maintenance and while you are writing to them, ask for a copy of the accounts for the maintenance fees stating what the fees are covering.

 

When you bought the property you should have received a copy of the leasehold agreement and if there have been any changes since, you should have been sent a copy of the revised agreement. If you don't have this, ask for a copy, but they may charge you an admin fee.

 

The Solicitors should pay the management company the £596, but be prepared for them not doing so. They may decide to pass on only a proportion of the money and keep some of it. This then leaves a debt for the ground rent/maintenance. Hence why you should ensure the management  company are made aware in writing that the £596 paid to the Solicitors is only for ground rent and maintenance fees.

 

You need to start being a bit more careful with how you handle these matters. Yes you could be taken to Court, as the leasehold agreement will allow fees to be charged including these Solicitors fees.  Not sure you want to be in Court arguing if the Solicitors fees are reasonable or not.