The lease sets out your legal obligations and rights – for example, Rykneld Homes has to maintain the building (on behalf of the council), whilst you have to maintain the inside of the flat. The lease is an important document as it states what you can and cannot do in relation to the property – it also states what we can and cannot do.
Have the lease checked by a solicitor and study it carefully. Ensure you keep a copy for reference as if you buy with a mortgage, your mortgage lender will probably keep the original.
When you apply for Right to Buy a flat, you will be sent a notice (S.125) telling you the price you will need to pay to purchase it and an estimate of the maximum costs we expect you will have to pay over the first five years of your ownership of the flat. These would be the service charges.
This is to help you decide if you can afford what can be an expensive ongoing commitment. After the initial five year period, we will be able to charge you an apportionment of the full cost of any works.
In addition to building maintenance costs (service charges), there are other costs in relation to home ownership that you should consider, including:
You will be responsible for such things as electrical installations, central heating and plumbing – work of this nature can be very expensive.
Mortgage and possibly mortgage protection insurance
Interest rates are reviewed regularly and you need to budget for possible increases in repayments. You may also wish to consider mortgage protection insurance to cover against being unable to pay your mortgage if you became ill or lost your job. Your mortgage or financial advisor should be able to advise you about these.
Normal household bills such as Council Tax, water and utility bills and contents insurance should be taken into account.
Purchasing costs such as legal costs, survey costs, mortgage costs and possibly Stamp Duty can be very expensive.
If you think you might want to resell your flat in the future, you may wish to talk to a local estate agent to see if your flat is one that might sell easily. If it is of non traditional construction, be sure a future purchaser will be able to get a mortgage on it, otherwise you might find it difficult to sell.