Rented Property

As property law experts Attwells Solicitors can support you with a range of services ideal for property professionals who rent property either as an individual or as a business. 

Regardless of whether you are an accidental landlord or a director of a property company with a varied portfolio Attwells can help. 

Below is a collection of services with information highlighting their benefits and under which circumstances you may require them. 

We have also outlined the costs involved for the services we offer fixed fees for. Please click on the green buttons throughout this page to contact the relevant solicitor for the service you require. 

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Transferring a Property into a Company

Transferring a property, or properties, from individuals to a company has increased in popularity recently. Having both pros and cons to the new structure, it is important to ensure the change is right for you.

There may be a number of reasons why you would transfer properties into a company such as:

  1. You are looking to buy another property to live in and rent out your current property. If you keep the current property in your individual names, you will pay the higher rate of Stamp Duty Land Tax on the new purchase;
  2. The loss of mortgage interest relief for individual buy to let has made company buy to let where this relief remain popular;
  3. Paying Corporation Tax (currently at 19%) rather than Income Tax (currently 20% at the Basic Rate or 40% at the Higher Rate); especially when you are a Higher Rate Tax Payer; and
  4. Other tax planning.

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The process for transferring the property and setting up the new structure is as follows:

1. Have an initial chat

Discussing the process and asking any general questions may give you a better idea of what it involves and whether it is right for you.

2. Take specific tax advice

We strongly suggest taking tax advice from a property specialist accountant as there may be tax reliefs and benefits available to you. They can also confirm whether the change is right for you looking at the tax benefits and the costs of the transfer.

3. Organise your mortgage (if needed)

If transferring is right for you, we recommend getting in touch with your mortgage provider. It is likely when you transfer the property from your individual names to the company that you will need a different type of mortgage i.e. a commercial Buy-to-Let mortgage. You may also want to instruct a mortgage broker to look at new mortgage offers following the transfer.

4. Instruct a solicitor

A solicitor will deal with the legal transfer of the property. This may also involve redeeming your current mortgage and dealing with a Lender’s requirements on any new mortgage. At this time, the new company can also be incorporated to hold the property.

5. Complete the transfer

Once the solicitor has reported to you on everything including any new finance documents, the documents will be signed and the transfer completed at the Land Registry.

Things to consider:

  • Unless you qualify for an exemption (please check with a tax advisor), the company may need tp pay SDLT on the value of the property that is transferred.
  • Commercial Buy-to-Let mortgages generally have a higher rate of interest.
  • Once the property is transferred to the company, if the company goes into liquidation or any other insolvency position, the property will be at risk.
  • If you decide to sell the property in the future, any profits from the sale will belong to the company and the company will pay Corporation Tax. The profits would then need to be distributed to the shareholders and further tax i.e. Income Tax would need to be deducted.
  • Company directors/secretaries are under a number of obligations to comply with Corporate Law including various director’s duties. The company must also file their accounts and confirmation statements online each year otherwise the company is at risk of being struck off the Companies House register. Therefore keeping on top of the admin is vital.

Legal Fees for Transferring Properties in a Company

 

Freehold

Leasehold

Base fee – Market value less than £500,000

£850 plus VAT

£1,100 plus VAT

Base fee – Market value more than £500,000

£1,150 plus VAT

£1,400 plus VAT

Mortgage Admin fee for redeeming only

£200 plus VAT

£200 plus VAT

When you are transferring a property you may also need to refinance the property and you may need independent legal advice.

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Company Buy to Let

In the last few years a big trend in the property sector has been people buying residential investment property using a company structure.

Until a few years ago company buy to lets were rare for the very wealthy and any mortgage finance was expensive.

However in the Summer of 2015 the Government introduced changes to limit the deductibility of mortgage interest and as a result there has been a considerable shift to either investors selling up or incorporation.

You need accounting advice as to whether a company structure is right for you and it will depend amongst other things upon whether you are trading in property or holding for investment. 

The potential benefits are that corporation tax treatment on your profits could be more advantageous than you being taxed as income tax. The company structure will also enable you to have flexibility as to the withdrawal of profits. 

As of April 2020 mortgage interest will no longer be an allowable expense for individual property investors but it will continue to be so for companies. These changes are now being phased in.

There are also opportunities to mitigate against IHT.

In addition to the potential tax benefits you are able to limit your personal liability through a limited company unless you are required by a lender to give a personal guarantee.  

At Attwells we have identified the trend to company buy to lets and acted for a number of investors on incorporation. There is complex SDLT advice that may be required around incorporation which needs to be considered.

We are also experienced in acting for the major lenders in the market and have experience of their security documentation. Related to this point we offer Independent Legal Advice to directors undertaking a company purchase or refinance.

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What is excluded from the service?

  • Legal advice outside the scope of the conveyancing service
  • Tax advice 

Fees

The fees payable for company buy to lets are as per the Attwells Residential Calculator save that an additional sum of £225 plus VAT is due.

In the event that it is a company buy to let purchase using mortgage finance or re-mortgage then £749 plus VAT is due on top of our residential fee scale.    

Disbursements

SDLT will also be due and you can calculate your liability by reference to the Government Tax Service webpage. If VAT is payable on the price the SDLT is payable on the price + VAT.

Land Registry Fees are due and will be payable based upon the purchase price and using the registry fee scale.

If the buyer is a company taking lending then a Companies House fee will be payable of £23.

In all cases bankruptcy and final searches will be due of £25.

If the premises are leasehold then notice of the transfer of the premises will need to be served on the Landlord whose costs typically range from between £50 and £200. We will confirm he figure once it is known to us.

How long will it take?

Timescales vary and on average it will take 4-6 weeks but it depends upon a number of factors outside of our control. We will endeavour to complete the matter quickly as possible within your timescales.

Who will do your work?

Your matter will be undertaken by one of our Commercial Property Solicitors: Nick Attwell; Matthew Desborough or Joseph Harrison or our Trainee Solicitors under the supervision of Nick Attwell.

When will I pay?

You will need to pay 50% of the fixed fee on account together with the search fees. The balance of fees and disbursements will be due on completion.

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Property Finance

Attwells Solicitors are expert providers of Property Finance legal services. We have extensive experience acting for Lenders, SMEs and Individuals on all types of property finance.

Property finance can be complex due to the many possible variations. Attwells are property law experts making us the ideal legal firm to support you through this process. We have a strong authority within the property sector and can advise you on all types of property finance.

To the left are a list of services we provide in this field, with information for intermediaries too. Below is a brief outline of the types of property finance available:

Buy to Let Mortgages

A buy to let mortgage is a loan for purchasing (or refinancing) residential property which is then let to individuals.

Recent legislation changes have made lending criteria for buy-to-let mortgages considerably more stringent.

Increased SDLT and a phased removal of a considerable income tax benefit for BTL Landlords (where the cost of mortgage interest will no longer be tax deductible) has seen a general decline in the popularity of BTL mortgages in recent months.

Increasingly, BTL investors are acquiring premises through a limited company, as the scheme of taxation for corporates is seen by many as more favourable when compared to the new individual tax regime.

The Property market in London, which has historically been the mecca for BTL property investors has slowed down since the Brexit vote and capital values in the Capital have been on a steady decline since 2016. Other parts of the country, however, seem to be more buoyant.

The focus of BTL investors remaining in London seems to be moving away from Capital Values (bigger gains are now seen to be available elsewhere in the country) and more towards yields.

This has seen a big shift from typical BTL investment away from typical houses and flats and more towards potentially higher yield investments, such as Student Lets and HMOs.

It may be that the appetite for capital returns in London may return when the market is perceived to have bottomed out and there are some bargains to be had.

In the meantime we expect to see a continued pattern of fewer BTL deals being done particularly in London, and increased proportion of those being acquired through corporate vehicles. For the time being this pattern shows no sign of abating.

The fact remains, however, that BTL Mortgages continue to make up a substantial part of the UK Property Finance Landscape. BTLs continue to be the right investment for many who have done the maths and are satisfied that the figures still “stack up”.

Buy to Let Legal Fees:

The fees payable for company buy to lets are as per the Attwells Residential Calculator save that an additional sum of £225 plus VAT is due.

In the event that it is a company buy to let purchase using mortgage finance or re-mortgage then £749 plus VAT is due on top of our residential fee scale.  

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Commercial Buy to Let and Investment Mortgages

Commercial investment mortgages are for those looking to acquire or refinance commercial property with view to renting it out to commercial tenants.

For many property investors having a healthy proportion of Commercial Properties is an essential part of a balanced portfolio. For others, perhaps those with a Residential portfolio, the prospect of branching out into Commercial is a daunting prospect.

However, with recent changes to the Residential BTL market and a greater focus on yield based (as opposed to capital based) investments, we are seeing an increase in clients taking the leap into acquiring commercial premises.

Some potential benefits of commercial BTLs:

  • Potentially higher yields
  • A “clear” rental stream, meaning that Tenants need to undertake maintenance or fully reimburse the Landlord for the cost of maintenance
  • Potentially less initial capital expenditure to acquire the site.

If you are looking to acquire a commercial premises through finance or looking to refinance your existing properties, it is essential that you have the right lawyer in your corner.

Company Buy to Let Legal Fees:

The fees payable for company buy to lets are as per the Attwells Residential Calculator save that an additional sum of £225 plus VAT is due.

In the event that it is a company buy to let purchase using mortgage finance or re-mortgage then £749 plus VAT is due on top of our residential fee scale.  

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Bridging Loans

Bridging Loans are Short Term Finance that are usually arranged within a short time-frame.

Bridging finance is useful to gain capital quickly and typically is an interim solution until a lower-interest, more long term solution can be found. As the name suggests, they exist to “bridge” a gap.

Bridging finance is always used to raise finance quickly, and often in one of the following scenarios:

  • Property Refurbishment
  • To complete a development
  • To purchase property that is unsuitable for lending from a mainstream lender
  • To bridge a finance gap between the acquisition of one property and the sale of another etc.

Since it is for a specific short-term purpose, interest rates can be higher than traditional term loans. A bridging lender will also normally require a clear exit strategy, to ensure that the bridging loan and any interest costs will be fully repaid.

Whatever your motivation for obtaining Bridging Finance, where you are an individual or a company, you need the right lawyer in your corner.

Bridging Finance – From £899 plus VAT

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In addition to all of the above fixed fees the following fees may also be payable:

  • Payable in all cases - Bank Transfer Fee (per transfer) - £40 plus VAT
  • Payable in all cases - Electronic Identification Fee (per person) - £10 plus VAT
  • Search Fees will vary from the type of finance but between £550 plus VAT and £1500 plus VAT

Included in the service

  • Ensuring the lender has good and marketable title.
  • Reporting to you on the security documentation.
  • Discharging any existing lending
  • Securing any new lending
  • Registration of the security at HM Land Registry
  • Registration of the security at Companies House
  • Completion of the remortgage

What is excluded from the service?

  • Legal advice outside the scope of the service described above
  • Tax advice
  • If the property is leasehold it does not include an additional  work ion connection with the review of the headlease.
  • Any property transfers needed for the property finance
  • Any company work outside of the finance that is required

Disbursements

Land Registry Fees are due and will be payable based upon the purchase price and using the following link.

If the buyer is a company taking lending then a Companies House fee will be payable of £23.

In all cases bankruptcy and final searches will be due of £25.

If the premises are leasehold then notice of the transfer of the premises will need to be served on the Landlord whose costs typically range from between £50 and £200. We will confirm he figure once it is known to us.

How long will it take?

Timescales vary and on average it will take 4 weeks but it depends upon a number of factors outside of our control. We will endeavour to complete the finance as quickly as possible within your timescales.

Who will do your work?

Your matter will be undertaken by one of our Property Finance Solicitors: Nick AttwellTanya WarnesMatthew Desborough or Joseph Harrison or our Trainee Solicitors under the supervision of Nick Attwell.

When will I pay?

You will need to pay 50% of the fixed fee on account together with the search fees. The balance of fees and disbursements will be due on completion.

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Landlord & Tenant Law

Price: £350.00 plus VAT

What is included in the price:

  • Initial telephone conversation
  • Review of documentation in advance of drafting letter of advice (subject to reasonable number of documents)
  • Letter of advice setting the the legal position, our advice and an assessment of prospects of success for any potential claims
  • Answering any brief questions subsequent to letter of advice

What is excluded from the price:

  • Meeting at your local office with a lawyer (can be arranged at additional cost)
  • This service is subject to a fair user policy and will not, for example, be available in the context of complex litigation cases. We will notify you if you matter is not suitable for this service as soon the position becomes apparent and no charges will be rendered. We will recommend alternative pricing structures and services as appropriate.
  • Legal advice outside of the service requested

Disbursements:

Copy documents will be obtained as necessary at cost price from the land registry.

How long will it take?

The letter of advice will be produced within 10 working days from the date of instruction.

When will I pay?

Attwells Solicitors will ask you for money on account in advance of the reviewing your documents and drafting the advice letter so that work can get underway on your matter immediately.

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Lease Extensions

Leases are commonly known as a diminishing asset. This means that the lease term gradually shortens as time goes on. Leases with less than 80 years may be difficult to sell or to secure a mortgage on.

It is therefore important to extend the lease either by agreement, or by serving notice, well before this point to safeguard the value of your property.

Voluntary Extension

If you have an agreement with your Freeholder then the process is straightforward. We can help you record this or negotiate it as necessary before arranging registration at the Land Registry.

Statutory Extension

The Leasehold Reform, Housing and Urban Development Act 1993 (as amended) enables tenants to extend their lease by 90 years in addition to the current unexpired term at a nil ground rent (£0), in return for paying the Freeholder a premium.

In order to qualify for this process the flat must be held under a long residential lease (i.e. originally granted for a term of more than 21 years) and the flat must have been owned for more than 2 years.

This process involves serving a S.42 Notice upon the Freeholder setting out basic details about the flat and the premium you would be willing to pay for the extension.

The Freeholder then has the right to respond with a Counter-Notice setting out what terms they propose or if they don’t believe that you have the right to an extension.

This is typically followed by a period of negotiation and if an agreement cannot be reached the matter can be referred to the First-tier Tribunal (Property Chamber) to make a ruling.

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Leasehold Extension Solicitors Fees

Notice of Claim

  1. In order to apply for an extended lease you must serve notice on your landlord. The notice served upon your landlord will include the premium you expect to pay for the new lease. For the purposes of negotiation your valuer will often advise you to put in a figure less than that which you ultimately expect to pay.
  2. The date of service of the notice of claim is the "valuation date", which will be used to calculate the amount of premium to be paid.
  3. Our fees for taking your instructions, liaising with your valuer, preparing the notice and ensuring that it is properly served on all of the relevant parties are fixed at £395 + vat.
  4. We recommend that the notice is registered at the Land Registry once served, this will protect your claim in the event that the freeholder were to sell the freehold during the currency of your claim. Our fees for registering the notice are £150 + vat plus a Land Registry Fee of £40.

Landlord's Response

  1. Once you have served notice on your landlord, he or she then has a period of two months within which to respond. The landlord will ask for a deposit to be paid which will amount to 10% of the premium that you have specified in the notice of claim. The landlord will also request access to the flat in order to carry out a valuation of the property. The landlord will then serve a counter-notice which will usually admit the claim and will contain counter-proposals in respect of the premium to be paid.
  2. It is possible for the landlord to reject a claim, for example where the landlord has clear plans to redevelop the building. In order to reject the claim the landlord must make an application to the court and prove the grounds for the rejection. Our fee for receipting and reporting to you on the counter notice are £150 + vat.

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Negotiations

Once your landlord has served a counter-notice on you admitting the claim, the parties will commence negotiations for the premium to be paid for the new lease and the form of the new lease. Your valuer will conduct the negotiations for the premium to be paid. During this time we will monitor the progress of the negotiations, supply any information that we are asked for and ensure that any key deadlines are met in order to protect your claim. Our fee for this work is fixed at £250 + vat.

First-tier (Property) Tribunal – sometimes required but usually avoided

In the event that negotiations are stalling either party may apply to the First-tier (Property) Tribunal for the dispute regarding the price or the lease terms to be determined. Such an application must be made by one of the parties before the end of six months following service of the counter-notice otherwise the claim for a new lease is deemed to have been withdrawn and you will be unable to make a further claim for a period of one year after that date.

Even where it is expected that the lease terms will be agreed between the parties it would be usual to apply to the Tribunal for a hearing date as this acts to focus the minds of the parties to bring negotiations to an end. The hearing date is usually three to four months after the application is made. Our fee for making the tribunal application is £525 + vat. These costs are typically incurred in only about 40% of the cases that we deal with.

Whilst it might be necessary to make the application to the tribunal to protect your claim (because time is running out and terms have not been agreed) it is rare for the tribunal to actually decide the lease terms. This is because a hearing at the Tribunal to determine the premium or terms in dispute can be expensive and would only be advised where the difference between the valuers is significant and the gain would warrant any potential costs. Our fees for preparing the documents necessary to present your case at the tribunal is £525 + vat but this does not include the cost of presenting your case which will involve the instruction of your valuer or an expert barrister. These costs are only incurred in about 5% of all cases we deal with.

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Completion

The lease will be completed following agreement of the premium and the terms of the new lease. The lease extension should be completed within two months of the terms being agreed as, after that time has elapsed, either party may apply to the court to strike out the claim. The parties may apply for an extension of time but if the new lease is not completed within four months and the parties have not applied for an extension the claim is deemed to have been withdrawn and you will be unable to make a claim for a further period of one year after that date. Our fees for completing  and registering the new lease (including its negotiation and all associated advice) are £950 + vat plus a Land Registry fee of £40 and final searches at £10.

What is included in the price:

  • Initial telephone conversation
  • Review of documentation in advance of drafting notice of claim
  • Regular updates
  • Answering any questions as they arise

What is excluded from the price:

  • Meeting at your local office with a lawyer (can be arranged at additional cost)
  • Our fees for tribunal applications cover only the making of those applications and preparing the documents for them, representation at the hearing is not included and options will be discussed as and when the need arises
  • Your valuation costs which are payable to your professional valuer are not included
  • Your freeholder’s professional costs are not included within this quotation
  • Legal advice outside of the service requested

Disbursements:

Land Registry fees as stated above.

How long will it take?

From service of the notice to completion of the new lease, the average formal lease extension takes about 6 months.

When will I pay?

Attwells Solicitors will ask you for money on account in advance of the reviewing your documents and drafting the advice letter so that work can get underway on your matter immediately.

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Collective Enfranchisement 

Leaseholders acting together may be able to require the Freeholder to sell the Freehold of the Property to the Leaseholders under the Leasehold Reform Housing and Urban Development Act 1993.

Purchasing the Freehold offers a number of advantages:

  • The Leaseholders can extend the length of their leases to increase the value of their property.
  • New leases can resolve any discrepancies within the old leases e.g. poor drafting, non compliance with the requirements of the Council of Mortgage Lenders.
  • It gives the Leaseholders control of the management of the Building and who the Managing Agent is.

Do the Leaseholders & Building qualify for enfranchisement?

  • There must be at least two flats in the Building containing qualifying tenants i.e. a Leaseholder who was originally granted a lease of over 21 years.
  • At lease two thirds of the total number of flats in the Building must be owned by qualifying tenants.
  • At least 50% of the qualifying tenants must want to proceed with enfranchisement.
  • The Freeholder must not be a resident landlord i.e. a block of four or fewer flats where the Freeholder or an adult member of his family lives there.
  • Is the Building or part of the Building self-contained i.e. structurally detached from other buildings or parts of buildings?
  • No more than 25% of the Building can be used for non-residential purposes e.g. commercial leases.

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Possession Proceedings for Landlords

Possession proceedings are every landlord’s worst nightmare. Their property has been let and you have received the first few rent payments. Everything seems to be going fine until suddenly, without notice, the payments stop. The tenants stop returning your calls and won’t respond to your letters.

Despite background checks, references, and payment on account, the tenants have failed to honour the terms of the tenancy agreement. At the same time, the landlord is worrying about how they will make mortgage payments and recover the mounting rent arrears. However, the wheels of justice can turn slowly and, to make matters worse, if the correct procedure is not followed to the letter, the Court may adjourn the claim, causing further delay or worse, the claim might be struck out which would mean having to start the process all over again.

The key objective for a landlord is to recover back possession as quickly as possible and minimise the rental void.

Attwells are a law firm with a nationwide reach and regularly act for landlords based in and outside of the UK. We pride ourselves on being able to respond quickly to new instructions and developing scenarios. Where possible we offer a fixed fee for the possession procedure.

Serving Notice

We will serve the appropriate Section 21 and / or Section 8 notice for a fee of £175 + vat per notice.

Application to Court

We will prepare and  issue your court claim. The fees are as follows:

 

Attwells Fee 

Court Fee

Section 8 claim

£525 + VAT

£325

Section 21 claim

£525 + VAT

£325

Accelerated Possession Claim

£599 + VAT

£355

Court Hearing

We will prepare for the court hearing by drafting witness statements and certificates of service. We will also instruct an advocate to attend court to present your claim to the Judge. Our fee for this work is £395 + VAT.

Bailiff Action

If the tenants do not leave on the date ordered by the Court we will instruct a county court bailiff to perform a physical eviction. The fees involved are £121 court fee and our legal fees of £225 + VAT.   

What is included in the price:

  • Initial telephone conversation
  • Regular updates
  • Answering any questions as they arise

What is excluded from the price:

  • Meeting at your local office with a lawyer (can be arranged at additional cost)
  • These fees assume that the property is let on an assured shorthold tenancy and that all of the regulatory requirements which entitle you to serve a notice have bene complied with by you or your agent.
  • Your valuation costs which are payable to your professional valuer are not included
  • Your freeholder’s professional costs are not included within this quotation
  • Legal advice outside of the service requested

Disbursements:

Court Fees as stated above.

How long will it take?

The timescales vary depending upon the type of notice served and the process followed, each case must be considered individually but we will always – without exception – endeavour to procure possession as soon as practicably possible.  

When will I pay?

Attwells Solicitors will ask you for money on account in advance of the reviewing your documents and drafting the advice letter so that work can get underway on your matter immediately.

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