Selling house - solicitors asking for indemnities everywhere
Discussion
We are selling our flat and whilst it seemed to be going ok, the same can’t be said for our purchase, I have gotten up the morning to requests for monies to be paid to our buyer or to take out indemnity policies.
I have no idea what they mean can anyone shed any light on what they are and if there is anything we can do aside from pay?
There is no provision in the Lease for the suspension of rent should it become impossible to occupy the property due to damage or destruction by an insured risk, nor is there any provision dealing with the eventuality whereby it is not possible to reinstate the property. Please provide a suitable draft indemnity policy for approval.
12/04: We are not content with the response. We will require either a Deed of Variation, or an allowance of £247 to cover the cost of a suitable indemnity policy.
Please provide a copy of the Lease dated 5 June 1968, which has been referenced on page 3 of the Lease.
12/04: We are seeking an allowance of £181.98 to put in place a suitable missing particulars indemnity policy on completion.
In addition to the above, which I don’t understand, the solicitors are asking for a service charge retention deposit (which they charge an equal amount for holding) in the even there are extra charges at the end of the payment period.
Given that we pay service charge in advance, we offered to get confirmation from the management agency that there would be no further charges the day before completion. This was agreed by the buyer.
Their solicitors have come back saying this is unacceptable and want the retention charge, but they are unwilling to do it the other way. Because we pay in advance, when we complete there is a high chance the buyer will owe us money, but their solicitor will not accept our request for a retention charge???
And to top it all off we had no kitchen door in the flat when we moved in and we removed the glass from a broken internal window / serving hatch and they are asking for another indemnity policy to cover these! We’ve had confirmation from the agent that these are cosmetic only and no permissions are needed.
I suspect that the solicitor is picking up commission on all these indemnities…
Our buyers seem like nice people and they have been over a few times now to measure up and left us their details.
Can we contact them directly to see if they will instruct their solicitors to stand down?
Can anyone shed any light on the new requests for cash are?
Thanks
I have no idea what they mean can anyone shed any light on what they are and if there is anything we can do aside from pay?
There is no provision in the Lease for the suspension of rent should it become impossible to occupy the property due to damage or destruction by an insured risk, nor is there any provision dealing with the eventuality whereby it is not possible to reinstate the property. Please provide a suitable draft indemnity policy for approval.
12/04: We are not content with the response. We will require either a Deed of Variation, or an allowance of £247 to cover the cost of a suitable indemnity policy.
Please provide a copy of the Lease dated 5 June 1968, which has been referenced on page 3 of the Lease.
12/04: We are seeking an allowance of £181.98 to put in place a suitable missing particulars indemnity policy on completion.
In addition to the above, which I don’t understand, the solicitors are asking for a service charge retention deposit (which they charge an equal amount for holding) in the even there are extra charges at the end of the payment period.
Given that we pay service charge in advance, we offered to get confirmation from the management agency that there would be no further charges the day before completion. This was agreed by the buyer.
Their solicitors have come back saying this is unacceptable and want the retention charge, but they are unwilling to do it the other way. Because we pay in advance, when we complete there is a high chance the buyer will owe us money, but their solicitor will not accept our request for a retention charge???
And to top it all off we had no kitchen door in the flat when we moved in and we removed the glass from a broken internal window / serving hatch and they are asking for another indemnity policy to cover these! We’ve had confirmation from the agent that these are cosmetic only and no permissions are needed.
I suspect that the solicitor is picking up commission on all these indemnities…
Our buyers seem like nice people and they have been over a few times now to measure up and left us their details.
Can we contact them directly to see if they will instruct their solicitors to stand down?
Can anyone shed any light on the new requests for cash are?
Thanks
I had similar issues when selling a leasehold flat. One of the reasons I'd never buy another is because it seemed like upon selling, it was an opportunity for the leaseholder and service charge company to charge for all sorts of admin and obscure things in the lease. I was charged many hundreds of pounds just for them to field a set number of questions from the solicitors and they somehow managed to always reply to a question with such inefficiency that it posed another question. We then had to buy another 10 questions for a further few hundred pounds.
I did have to pay for the service charge in case of any unexpected extra charges for my period of living there but I got this back after the service charge accounts were settled a year after I sold.
I did have to pay for the service charge in case of any unexpected extra charges for my period of living there but I got this back after the service charge accounts were settled a year after I sold.
KAgantua said:
What does your solictor say?
Yup. If you don't have one I would find one and get them involved. Sounds like the other lawyers are doing their best to milk you - a solicitor acting on your behalf should be able to minimise that at best, or tell them to get lost if they are trying to fleece you.parabolica said:
Yup. If you don't have one I would find one and get them involved. Sounds like the other lawyers are doing their best to milk you - a solicitor acting on your behalf should be able to minimise that at best, or tell them to get lost if they are trying to fleece you.
Our solicitor has just passed these on this morning. She says that they are not essential or mandatory, but it comes down to arguments. I do think it is the buyer's solicitor trying to get more cash out of us as they will be charging for setting up the indemnities.We agreed with the buyer that we would just cover the service charge and any extra costs, and the management agent would vouch that we would not have any extra costs, I know this for a fact as I am the Director of the estate.
We have a dead line of end of May (because of the buyer's mortgage) and our vendors have agreed to move out early to accommodate too, now it seems that the buyer's solicitor is being a blocker.
However, no one can seem to tell us what the actual clause means?
Wildfire said:
Our solicitor has just passed these on this morning. She says that they are not essential or mandatory, but it comes down to arguments. I do think it is the buyer's solicitor trying to get more cash out of us as they will be charging for setting up the indemnities.
They won't - they are just trying to get the best cover for their client. You can instruct your solicitor that you won't entertain them and see where it goes. I doubt it would be contentious enough for them to pull out of the sale for.Chris
OutInTheShed said:
when they start asking silly questions over minor things, I suspect they are stalling either because their finance isn't there, ore they are keeping their options open with another potential purchase.
We've progressed with everything and they are well ahead of us, with searches etc all in place and returned etc. It seems to be their solicitors as when we met the vendors they didn't really understand what was going on in detail and said they had trusted it to their solicitor.
I am now scanning the law society standard contract and find all sorts of clauses.
In all fairness one does say we need to provide all leases and we can't find / don't know where the underlease is.
I am going to ask our solicitor to find alternative quotes.
Is the buyer an FTB?
We had a similar issue when selling our flat, including a service charge indemnity, ground rent indemnity and some other bs about the risks of a lease in a shared building.
I told the buyer I was going to re-market after the 3rd email and if they wanted some insurance they should buy their own.
They didn’t ask for anything again.
But that reminded me, the day they moved in they locked themselves out and had the cheek to call me to ask if I had kept a set of keys..
We had a similar issue when selling our flat, including a service charge indemnity, ground rent indemnity and some other bs about the risks of a lease in a shared building.
I told the buyer I was going to re-market after the 3rd email and if they wanted some insurance they should buy their own.
They didn’t ask for anything again.
But that reminded me, the day they moved in they locked themselves out and had the cheek to call me to ask if I had kept a set of keys..
Edited by dbryder on Wednesday 13th April 19:57
Wildfire said:
I suspect that the solicitor is picking up commission on all these indemnities…
Our buyers seem like nice people and they have been over a few times now to measure up and left us their details.
Can we contact them directly to see if they will instruct their solicitors to stand down?
We were in direct contact with the seller when we were buying this house (FTB). The whole process was delayed three weeks over an argument about an indemnity for windows without certificates - neither of us knew what was going on, nor had asked for it, but I guess we pay these people to represent their interests, and they take it to the nth degree. In the end it was all over £40. It might be worth approaching the buyer if they are sensible.Our buyers seem like nice people and they have been over a few times now to measure up and left us their details.
Can we contact them directly to see if they will instruct their solicitors to stand down?
I was in a similar position over a year ago. Apparently neither the buyer's solicitor or mine(!!) didn't look at the Land Registry documents in any great detail. They looked at the leasehold title, but couldn't find a right of access from the main road; this was on the freehold/landlord title which I ended up paying £3 for online & emailing to both of them..... Without it, I was quoted £400 for indemnity insurance in case of any future disputes.
It beggars belief how daft, expensive, stressful & slow the whole process is. The upshot for me is never to buy a leasehold property ever again!
It beggars belief how daft, expensive, stressful & slow the whole process is. The upshot for me is never to buy a leasehold property ever again!
Thanks all.
We've conceded on one indemnity as the contract does say we need to supply all leases and no one can locate the lease clause from 1965, if no one can find it, then how it will come up, who knows?
We're pushing back on "in the event the flat is destroyed and no rebuilt" and "no door in the kitchen".
We've told the agent that if they want these all in place, at a fair cost, it will take a while for us to factor the extra in to our finances and we will still have to consider these and it raising the funds may very well push the sale past their mortgage expiration.
It seems that it is the solicitor who is pushing for the indemnities (and charging to arrange), so we have said that the buyer needs to be prepared to lose their rate and that they need to ask the solicitor whether these are worth the property?
We shall see.
We are buying a freehold and (fingers crossed) we don't plan on moving again.
We've conceded on one indemnity as the contract does say we need to supply all leases and no one can locate the lease clause from 1965, if no one can find it, then how it will come up, who knows?
We're pushing back on "in the event the flat is destroyed and no rebuilt" and "no door in the kitchen".
We've told the agent that if they want these all in place, at a fair cost, it will take a while for us to factor the extra in to our finances and we will still have to consider these and it raising the funds may very well push the sale past their mortgage expiration.
It seems that it is the solicitor who is pushing for the indemnities (and charging to arrange), so we have said that the buyer needs to be prepared to lose their rate and that they need to ask the solicitor whether these are worth the property?
We shall see.
We are buying a freehold and (fingers crossed) we don't plan on moving again.
Gassing Station | Speed, Plod & the Law | Top of Page | What's New | My Stuff