X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Landlord Resources

    Freehold/Leasehold in joint names

    Hi

    My brother and I own a Freehold as tenants in common. We also own the Leasehold interest of the basement of this building. We are remortgaging this basement flat, and I've received the following notice from the Lender:

    'The Freehold cannot proceed in your Joint names as the Leasehold is also in your joint names. Therefore you will need to change the Freehold Title or set up a management company and transfer the Freehold into the management company name in order to proceed.'

    NB: What I haven't told them yet is we have set up a Deed of Trust whereby one of us is not a beneficiary to any rental income or sale proceeds of this property. Not sure if this matters.

    Q: What is the easiest way forward?

    Regards
    hratch
    0
    0
    You cannot legally create a lease to yourself hence the lenders response - all lenders would say the same.

    One of you needs to come off the freehold or the leasehold but you need to be aware of two things:-

    1. This is in effect a sale so seek legal/tax advice.

    2. Some lenders won't lend if there is ANY connection between freeholder and leaseholder so even if you do this ensure that the lender will still lend.
    0
    0

    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com


    Hi Lisa

    Thank you for your reply. The lender is Precise and I will check with them regarding this.

    Originally my mother, brother and myself were on The Freehold title. This is when a Lease was created on the basement flat to with my brother and myself on the Leasehold title. Later down the line my mother gifted her share of the Freehold to us two.

    Also as mentioned previously a Deed of Trust was drawn up whereby my brother is not a beneficiary to any rental income or proceeds of a sale.

    Do these points make any difference?

    Thanks for your help.

    Regards
    hratch
    0
    0

    I'm afraid your mom being a former party and the DoT make no difference to the names stated which are the same as such the lease cannot exist in law.
    0
    0

    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com