With continued uncertainty surrounding the global markets, investment in freehold property remains a relatively secure option for those seeking reliable, long-term returns above base interest rates. Freehold portfolio values have increased in recent years, with the demand for efficient collection of overdue ground rents and accompanying charges being an essential consideration.
Ground rent arrears cannot be considered as an afterthought to service charge recovery – having the support of an experienced team of lawyers to help manage large volumes accurately and with the ability to provide detailed financial reporting is invaluable.
We do not charge fees for our debt recovery service, no matter the outcome. That is what makes us unique.
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Experienced ground rent arrears recovery team
Ground rent is a small annual sum, typically no more than £200, that must be paid by a leaseholder to a freeholder as a condition of their lease. Ground rent must only be paid if it is detailed in the lease. If it isn't, the landlord won't be able to recover any ground rent from the leaseholder.
The lease should specify how much the ground rent is when it must be paid and to whom. There may also be provisions for periodic increases in the ground rent, for example, every five or ten years, and the required notice that the freeholder should be given regarding this. The lease should also stipulate the consequences of the leaseholder neglects to pay the ground rent when it is due.
When must ground rent be paid?
Freeholders should be aware that the payment of ground rent will only be compulsory if they formally demand it. You should formally notify the leaseholder by post, and your demand will only be valid if it includes the following required information:
- The leaseholder’s name
- The period to which the ground rent relates
- The amount due
- The freeholder’s name and address (or the managing agent’s details if they are collecting payment)
- The date when ground rent must be paid
Freeholders should be aware that a notice will be invalid if it is not served in conjunction with 'Notes for Leaseholders', a document that lists the freeholder's rights and responsibilities.
How to recover ground rent arrears
If you have made a demand for outstanding ground rent in the manner detailed above, and the leaseholder fails to make payment within the prescribed period, you can either:
- Attempt to recover the arrears through the small claims court; or
- Take forfeiture action against the leaseholder
Typically, attempts will be made to recover the outstanding sums rather than taking forfeiture action. We find that, in the majority of cases, notifying leaseholders of forthcoming legal action will often be sufficient to force them to pay outstanding sums. If the leaseholder is unable to make payment before the court hearing, a court order will usually be made demanding them to make payment within 28 days. If no payment is made, you will have the right to use bailiffs to repossess the property.
Forfeiture action is a more complicated process and requires the support of experienced debt recovery lawyers. You must follow the prescribed procedure correctly to avoid committing the offence of illegal eviction. Forfeiture action can only be initiated when the sums owed exceed £350.
How much ground rent can be recovered?
Under the Limitations Act 1980, ground rent is considered a contract debt. This means that it may only be possible to recover outstanding ground debt for up to six years. That said, ground rent arrears that date from more than six years are potentially recoverable. The six years, however, run from the date when the ground rent has been first demanded.
At Chandler Harris, we act on behalf of a broad range of clients across England and Wales, providing a customised ground rent recovery service on both criteria and non-criteria ground rent debts. Whatever your requirements, we can advise on cost-effective recovery strategies for large or small sums.
Our specialist legal team can provide you with:
- Fast and efficient recovery for all ground rent arrears
- Regular monthly reports that are transparent and insightful
- A dedicated manager for your account who will act as a consistent point of contact and will be available to answer any questions and discuss any issues promptly
- Top-level expertise on all ground rent arrears recovery matters
- Guidance and support on a wide range of property law matters
Our commitment to providing a high-quality service for our clients has been recognised by the Legal 500.
Chandler Harris can provide a fast and effective ground rent arrears recovery service, whether you are managing an extensive ground rent portfolio or chasing up a recent non-payer. We are specialist in all types of property debt, delivering a service that is uniquely tailored to our clients' needs and which not only meets their expectations but exceeds them. Unlike many of our competitors, the service that we provide comes at no cost to you – we recover any sums owed to us through the other party in every case.
Our ground rent arrears recovery lawyers have many years of experience in this area, covering individual and volume linked ground rent recovery. We can liaise with multiple property management companies on your behalf, supporting you to maximise your income streams in the most effective way possible. Our skilled team of lawyers will work alongside your credit control department, keeping you fully informed at every stage of the recovery process. Throughout your dealings with us, you will have a dedicated account manager who will be available to answer any questions or deal with any issues you have promptly.
Is the service really free?
Our ground rent arrears recovery service is provided at no cost to you as we recover all our costs from your debtors and will never ask you for sums to cover court fees, third party services or any other expenses. We will work tirelessly on your behalf to make the recovery of any outstanding debts as simple and straightforward as possible – whatever your circumstances, speak to one of the friendly and approachable ground rent recovery teams at Chandler Harris today.
Contact our ground rent arrears team
The ground rent arrears lawyers at Chandler Harris can offer expert assistance on all issues surrounding ground rent arrears. Whatever your requirements, speak to a member of our team today by calling 0161 836 9987 or complete our online enquiry form.