This page contains a Flash digital edition of a book.

Leaseholders can often be left confused, misinformed and sceptical of the terms and phrasing used in correspondence which is indecipherable to them; user-friendly explanations which clearly outline where leaseholder's money is being spent increases confidence and promotes a sense of reassurance that the property manager is working on their behalf. This is especially important when determining if there has been an over or underspend, resulting in an adjustment on the account. Residents are frequently – and understandably - reluctant to part with more money than they have been invoiced for but this can be remedied by demonstrating transparency in the finances and supplying copies of budgets which explicitly outline expenditure.

Ultimately, service charge management is a

collective effort between all the parties involved. After all, maintenance can only be carried out when the funds are available to cover the costs and, in turn, residents are only compliant in contributing their share towards the costs if they have the knowledge and assurance that their money is being spent fairly and appropriately. Actively creating an environment where residents and property managers can be seen to be working together not only makes service charge collection as pain-free as possible but also results in a well maintained block that residents enjoy living in and in which the flats hold their value.

Louisa Benbow is Call Centre Manager at Property Debt Collection Ltd in Hertford

In this situation, managing agents will be able to implement a streamlined process to ensure that the service charge is demanded correctly and in line with the lease. Enforcement if necessary, happens in a timely and no- nonsense manner. A managing agent, not being a leaseholder, is also able to remove any emotion from the situation and provide the landlord (especially where they are leaseholders) with a shield, helping them to directly avoid any difficult situations.

Get together to tackle service charge problems

Small blocks are most vulnerable to non- payment, as Bob Smytherman explains

As chairman of the Federation of Private Resident's Associations (FPRA) and a director of a small self-managed block of flats in Worthing for more than 20 years, Bob Smytherman is only too familiar with the problems that can be caused by non-payment of service charges.

“In a small block, one resident who won't pay their service charge can have a huge impact on the annual budget process and day to day management of a small development as overall turnover is not as high as large blocks,” he explains.

“It also can make relationships between neighbours difficult as the directors have to balance the need for confidentiality about a leaseholder's service charge account and transparency when carrying out works from the service charge. This is particularly difficult when works may need to be delayed

Issue 20

or postponed due to lack of cash paid into the account in a timely manner”.

With his FPRA hat on, Bob recommends that leaseholders get together and form a residents association to give them a strong, democratic voice to speak on behalf of their block. “The aim of the FPRA is to make this process easier,” he says. “Members have access to an organisation with more than 40 years of experience providing impartial and independent legal advice to leaseholders.

My own block has been a member for more than 10 years and our directors frequently call on the legal advisors for assistance”.

If you are having problems with service charge collection, Bob's advice is to:

Read your lease to establish how you are able to collect unpaid service charges and whether or not the costs of doing so can be recovered from the leaseholder; and


Remember not all leases are the same and yours could impact on how you go about

Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72