When we finally arrange our financials and decide to buy a new house or a flat, we would be so excited that we might forget about essential aspects of leasehold ownership that would later on lead us to experience a leasehold scandal. One of the main spheres of leasehold purchase is its financial charges. In this article, you will find the three different types of leasehold charges, which you should know about before you find yourself signing a contract.
A ground rent is the annual fee you pay as the leaseholder to the freeholder, who is the land owner. It may seem very simple; however, your contract may contain a clause regarding the doubling or increasing the rate of this rent in upcoming years. Make sure you understand how it works or seek for professional help.
These charges include different maintenance projects the freeholder has planned and all that would need repair throughout the years. It may also contain building insurance charges. You will be asked to pay these fees annually, so knowing what plans the freeholder has for the building or house is essential for you not to be surprised at the end of the year.
During your ownership period, you might be charged with some additional fees. The latter may include fees for rewriting some of the terms and conditions of the original contract if an error was found in them or you simply want to fix something (with the agreement of the freeholder). Also, some freeholders would ask for permission fees, for example when taking permission to extend the property and allow pets indoors.
Financial issues are the main causes of leasehold scandals and; therefore, you should be aware of all these charges that might find their way into your life during your ownership period.