How to deal with a defective lease

When the terms of a lease are considered unfair by a leaseholder, the lease may be deemed to be defective. A defective lease can cause problems between you and your landlord or managing agent and also affect the saleability of your property. Brady Solicitors explain.

What makes a lease defective?

Every lease is drafted differently and drafting errors can sometimes mean that certain provisions are not accounted for. For example, if your lease is missing any of the following, it could be defective:

  • A provision to repair or maintain parts of the property
  • A duty to insure the building
  • A provision for the recovery of money spent for the benefit of another party
  • Service charge proportions which don’t add up to the correct percentage

A defective lease can cause problems when trying to sell a property as it can affect a potential buyer’s ability to obtain a mortgage. If a mortgage lender believes that the lease does not cover certain provisions they may refuse to provide security, forcing the buyer to withdraw.

So, it’s important to get your lease reviewed by a professional before putting your property on the market.

What should I do if my lease is defective?

If you have a defective lease, do not despair – there are ways you can correct it:

  • Where the defects are minor and are unlikely to cause problems in practice they can often be accounted for by taking out indemnity insurance. This can be a cost effective and quick way to reduce the risk.
  • A deed of variation can be agreed with the freeholder to remedy any defective provisions.
  • You may be able to apply to the First-tier Tribunal to vary the lease under the Landlord and Tenant Act 1987. It is worth considering whether other leaseholders in your block are interested in varying their leases too.

Defective leases – a managing agents’ perspective

It’s not just leaseholders that may wish to rectify a defective lease. Sometimes it is in the managing agent’s interest to vary their leases to deal with recurring requests/problems more effectively. For example, if you are receiving numerous requests from leaseholders in the same block concerning the installation of satellite dishes, keeping pets or parking issues, which are not currently provided for in the lease, it may save you time in the future to vary the leases to account for these provisions.

A lease review will help to identify these issues and ensure your leases are up to date and correctly drafted.

Whether you are a leaseholder or managing agent and would like advice about your lease, the lease specialists at Brady Solicitors can help.

Get in touch with our experts

With hundreds of years’ worth of combined experience, our experts have dealt with nearly every leasehold property matter you can imagine. If you’re currently in need of legal support or advice, please get in touch.

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