Extending my lease when I can’t trace the landlord
Q: I am in the process of buying a flat - it is leasehold with only 70 years left on the lease. The freeholder cannot be traced so I am concerned that I will have difficulty extending my lease. Can you advise me on what to do?
As you know, lenders are very reluctant to lend on leasehold properties with less than 70 years remaining on the lease – so even if you can get a mortgage now, you are likely to have difficulty at a later stage when you want to remortgage or sell on to a buyer who needs a mortgage.
So you are definitely right to be thinking about the need to extend now before you have gone through with the purchase.
However, to be eligible to have a right to extend your lease, you need to have owned the flat for two years. So you won’t be able to start the process until two years after completion – there is no quick fix.With regard to the issue of the absent landlord, you will need to make all reasonable efforts to track the landlord down – you will certainly need to ask the neighbours and make other enquiries. If it turns out the landlord is a company in receivership, you can serve notice to extend the lease on the receiver; if the landlord is an individual who is bankrupt, you can serve notice on the trustee in bankruptcy. If the landlord simply cannot be traced, then you will have to go to the county court for a vesting order – if the court is satisfied that you are eligible for a lease exension, then it can grant the lease to you in the landlord’s absence.
Bearing all this in mind, you will need to weigh up the pros and cons of buying this property – it is probably reasonably priced because of these complications which do bring some risks and could take some years to resolve. You should also speak to your solicitor carefully about this and try to get a view from her as to whether you should proceed or not. Don’t let the estate agents, the sellers or even your own solicitor rush you into making a decision.
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