I was recently instructed by a couple who wanted to purchase a buy-to-let property to rent out. They had already found a property that they wished to purchase, had lined up tenants to let the same and wanted to proceed quickly.
I always make a point of trying to find out as much information as possible about the transaction at the outset, which proved very useful in this instance.
I was able to discover that my clients were remortgaging their own property to raise the deposit needed to purchase the buy-to-let property.
As a consequence, I was able to conduct both transactions simultaneously, to the obvious benefit of my clients as they were anxious to proceed quickly.
The purchase proved to be complicated. Whilst my clients believed that they were purchasing a freehold property from a mortgagee in possession it transpired that all the mortgagee in possession was entitled to sell was the leasehold interest, as their former borrower had owned the property on a Shared Ownership basis. In such cases the freehold interest is always retained by the Housing Association.
I persuaded the seller’s solicitors to action the staircasing provisions under the provisions of the Shared Ownership Lease. The Housing Association then performed its own valuation and accepted that the price being paid by my clients reflected the true market value of the property
I co-ordinated the efforts of both the solicitors for the Housing Association and the mortgagee in possession to achieve a simultaneous purchase of both the freehold and leasehold interests, by my clients, and they have subsequently been registered as the freehold owners of the property.
Despite being somewhat complicated from a conveyancing perspective I was able to complete both my clients remortgage and their purchase within a month of obtaining instructions, and without the clients’ losing their prospective tenants.