A flat owner risks losing her home due to an unpaid service charge of £5,500
A flat owner has spoken of her pain at the prospect of losing her flat due to an unpaid service charge of £5,499.80.
Nicola Hawkins bought her flat in Romford in 2022 for £215,000. It is housed in a block that was converted in 2018.
Last year, she paid the service fee in full, but continues to dispute the charge with her so-called managing agent Court of first instance.
Miss Hawkins and her neighbors won £9,783.18 in court, but says she has yet to receive any of the money from the managing agent.
Nicola Hawkins bought her flat in Romford in 2022 for £215,000 and now risks losing it amid unpaid service charges of £5,499.80
So, this year she decided not to pay the full service charge because she believed the managing agent still owed her money and was spending too much on works being carried out on the premises.
Speaking to MailOnline Property and This is Money, Miss Hawkins said: ‘I told them you still had £1,273.19 of my money – my share of the win – and then paid another £1,000 towards my latest service charge bill.’
“This was more than it was worth, but I wanted to appear reasonable when we get back to the lower court.
“I am being bullied and claiming that they cannot take my apartment for not paying my services when I already won a case against them in the first instance court.”
At the point of exchange, Miss Hawkins discovered that the service charge was much higher than initially anticipated
She continued, explaining the impact this had on her health, saying: “I have been receiving treatment for the past year, and this situation is destroying my life and consuming a lot of my time.”
“We are desperate to move but we can’t. No one is going to buy a flat above a shop with a £5,500 service charge.
She bought the flat for £215,000, and her current mortgage repayments are £685 a month, having taken out her home loan before mortgage rates increased.
“The estate agent initially told me the service charge was £600 a year, then later during the buying process my mortgage broker said the figure was £1,200 a year,” she said. It was a shock but manageable with £100 a month.
“At the point of exchange, I found out the service fee was £1,900 a year. The solicitor said he had forgotten to send me the administration package. That firm of solicitors has since folded.
This year, Miss Hawkins decided not to pay the full service charge and paid £1,000
At this point, Miss Hawkins says she felt pressured to complete the sale because she feared she would lose her deposit.
“I was sending £35,000 to the solicitor as a deposit when I first saw that figure of £1,900. I was going to lose my deposit so I went ahead with the project and moved on.
“I spoke to other apartment owners and discovered that there were major problems with the roof that were not disclosed to me during the sale as the seller had already paid £1,400 separately for the service charge to repair the roof.
“Then I get a service charge later in the year, and the roof repairs charge is included in it.
“So the £5,500 is an overspend on last year, plus the estimate for 2024, including electricity and sewerage cabinet repairs that we didn’t even know had happened.”
It comes as Draft law reforming the lease and freehold system It is currently passing through Parliament.
The draft law aims to achieve this Cheaper and easier for more tenants To extend the lease, buy the freehold and take over management of the building, as well as ban the sale of new leasehold homes.
Service charges on a rented apartment are separate from ground rents.
Ground rent is a regular payment made to the freeholder of a leasehold property as a condition of the lease. Ground rent applies exclusively to leasehold properties.
These are the fees applied to leasing the land on which the rented property is located. It does not cover the costs of any additional services that the freeholder may provide – these are covered within the service fees.
Increases in service fees It has become more of a problem in recent years. As the government begins to clamp down on freehold and developers’ other revenue streams such as ground rents, service charges have become a proven way for investors to make money.
If a flat owner refuses to pay the service charge, they risk losing their home through a process known as forfeiture.
Forfeiture occurs when the landlord exercises his right to regain peaceful possession against the tenant’s wishes.
This usually happens when the tenant violates a term of the lease or breaches a covenant.
Have you experienced a sudden spike in service fees recently? keep in touch: [email protected]
(tags for translation) Daily Mail