Absent Freeholders - Conveyancing Specialists
Buying with an Absent Freeholder
It is essential to consider the significance of a leasehold property with an absentee Freeholder as soon as possible stage when buying a property with this problem in place. Quite aside from whether a lender is prepared to lend, a property with an absentee freeholder can, if not managed correctly, blight a property by inhibiting essential repair and maintenance and enforcing the provisions of the leases on other owners in the building.It is important to find an experienced conveyancing specialist to take early steps to assess if this can be remedied. Please note that if time allows, and given all the circumstances, it is usually best to regularise the position by applying to the courts for a vesting order.
Even if a lender is prepared to lend, there is no guarantee that a future lender will do so, rendering the property blighted to a degree.
Selling an Absent Freeholder
Many sellers have been unaware that their there is problem having an absentee freeholder until they come to sell or mortgage the property.
Don't bury your head in the sand and hope that your buyer and their lender, solicitor or surveyor fail to identify the absentee freeholder issue as an important. Speak to a absent freeholder legal specialist concerning your options to enhance your chances of selling or remortgaging your property. Some options are set out below. As to which is most relevant depends on your specific circumstances.
Conveyancing initiatives to address the problem of an absentee freeholder
Absentee Freeholder Indemnity Insurance Policy
It is often considered that the easiest and quickest course of action is to obtain defective title indemnity insurance. This is not a cure-all solution as it simply papers over the cracks of the problem rather than fully resolve it. A primary concern where there is an absent freeholder is not necessarily the rights to repair and maintain but the rights of access to be able to carry out repairs. An indemnity policy does not grant this. A policy should provide cover against any loss in value following damage due to the lack of maintenance or repair of an adjoining property. It should also cover any costs incurred by the owner of the Absentee Freeholder in prosecuting legal proceedings against the adjoining property owner.
One would usually ask the vendor to pay for Absentee Freeholder indemnity policy. There would usually be a one off premium for the current value of property although when one comes to sell, one may be asked to pay a further premium to increase the level of cover to the value at the time of sale.
Not all lenders will accept indemnity insurance as a solution. Please see Absent Freeholder Marketability Assessment as well as further information about absentee freeholder indemnity insurance at LenderMonitor.com.
Absentee Freeholder and Vesting Orders
One solution to the problem of an Absent Freeholder is pursued with the cooperation of the other leasehold owners.
Albeit that it is expensive it is possible for the leaseholders in a building to acquire the freehold reversion from the absentee landlord via a vesting order.
A vesting order in and of itself does not transfer title, but allows this to be done once the value of the freehold has been determined and that amount paid into court. It is a complex and time consuming process. Applications to both the cour court and the tribunal (to determine a valuation) is necessary, which must comply with their rules, and a final application for registration of the transfer must be made to the land registry. For these reasons and many more it is generally recommended to obtaining advice from qualified professionals. We are happy to help you find the right advisers.