Avoiding endless service charge disputes during freehold purchase

Organising the collective enfranchisement process in order to purchase the freehold on your block of flats can be both an exciting and draining time, with the amount of work required to succeed often seeming quite daunting. However, there are some things which should be avoided in order to help the process to run much more smoothly and efficiently.

One of the most draining aspects of the freehold acquisition process can be the ongoing service charge disputes. Often, residents’ associations can be affected by tunnel vision which stops them from seeing the bigger picture in the purchase of the freehold. Naturally, residents will be unhappy about what they see as unreasonable service charges but it is vital that these concerns are put to bed so that the process of collective enfranchisement can continue successfully. Engaging in endless fights with your freeholder over service charge disputes may well lengthen the whole process and lead the residents’ association into an ongoing battle which may never end.

Legal advisors and solicitors experienced in collective enfranchisement will be able to explain that residents’ associations that continue to run around in circles chasing service charge disputes with claims and counter claims will hardly ever be successful in their efforts to purchase the freehold on their block of flats. Largely speaking, this is a waste of energy which can be better focused on the greater good of collective enfranchisement. Remaining focused on the final goal is vital to ensuring the success of the process and is particularly important when working with residents’ associations or large groups of people as the focus can often be easily lost, making the whole process much more bloated and inefficient than it needs to be.

It is worth noting that if you are about to exercise your right to buy the freehold of your block and aren’t aware of any service charge disputes, you may well come across some during the process. As part of buying the freehold, the leaseholders must pay to the freeholder any unpaid and outstanding service charges-because they are buying the whole legal entity of the building including its assets and liabilities. It is vital, then, that the cash flow process is carefully managed in order to ensure that the funds are available for the service charges at the end of the process and that these charges are expected and anticipated properly.

It should be agreed in writing at the start of the process that the residents’ association will not pursue service charge disputes during the process and that each participant in the freehold purchase process will be responsible for his or her service charges. It should be stated that the aim of the residents’ association is solely to ensure the collective enfranchisement and not to waste time on pursuing other, smaller goals. It can be difficult for all residents to agree to this as they will naturally want to pursue what they see as unfair charges, but as long as everything is laid out clearly in writing before the process begins, it will ensure that the whole process runs much more smoothly than it otherwise might do.

When organising a group of people around a lengthy legal process like freehold purchase, trying to get the right advice across can be challenging and difficult. It is for this reason that hiring a solicitor specialising in freehold purchase work might well save you a lot of money in the long run as well as a lot of hassle. By consulting an experienced solicitor you will ensure that your residents’ association has all of the relevant information to hand and can take advantage of the advice that your solicitor can offer through their experience of the process with other residents’ associations.

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