The Collective Enfranchisement Procedure

1. How can I exercise my Collective Enfranchisement?
2. What are the likely costs involved?
3. What is the Procedure for buying your Freehold?
4. What if the Freeholder does not agree to the sale?
5. What if the Freeholder cannot be found?
6. How long does it take?

How can I exercise Collective Enfranchisement?

• There are two ways in which you can exercise your Collective Enfranchisement One way is to informally negotiate a value with the freeholder. The other is to formally serve a Notice on the Freeholder stating your offer price.
• Pro-Leagle offers a full Collective Enfranchisement service.

What are the likely costs involved?

• The Freeholder's "reasonable" costs in relation to the freehold valuation, legal advice taken on receipt on your Notice to purchase and any conveyancing costs of the purchase. You will not be required to pay his costs in relation to proceedings at the Leasehold Valuation Tribunal.
• Your own legal and valuation costs. This will include costs in serving the Notice to Purchase on the Freeholder, conveyancing the Freehold, redrafting the Leases and drafting a Participation Agreement.
• Payment to a Managing Agent service to manage the property on your behalf.
• Any amounts due to the Freehold or their Managing Agents will need to be paid before the full Freehold title can be transferred. If there is any dispute about the service charge, this can be determined by application to the Leasehold Valuation Tribunal. If the service charge is not paid, this will create a lien (or IOU) over the Freehold when it is transferred to you. You will need to pay or settle this outstanding charge before the lien is removed (The Leasehold Reform, Housing and Urban Development Act 1993).

What is the Procedure for buying my Freehold?

• You and the other Leaseholders can negotiate with the Freeholder directly to purchase the Freehold. However, if negotiations stall, you can compel the Freeholder to sell the Freehold to you by way of group purchase. Take the Collective Enfranchisement test to see if you qualify.
• Incorporate the Collective Enfranchisement Company. Group purchase is only exercisable through a Collective Enfranchisement Company.

1. Serve the Leaseholders who are NOT already members of the Company with a Notice Inviting Participation.
2. Decide how you are going to purchase the Freehold as a group. You will need to nominate either yourself, a fellow Leaseholder or the Right to Enfranchise Company to fulfil this obligation. The person or Company will be called the 'Nominee Purchaser' and will be specified in the Notice to Purchase (see below).
3. Obtain a Freehold Valuation.
4. Serve the Freeholder with the Notice to Purchase advising that you and other leaseholders are buying the freehold and stating the price. Register this with the Land Registry thereafter. Once you have served the Notice, you will become responsible for the Freeholder's 'reasonable' professional costs. By law, the Freeholder is allowed only two months to make a counter offer.
5. It is worthwhile noting that unless all participating leaseholders sign a Participation Agreement, which legally binds you in a consortium for the purposes of buying the freehold, you may find it difficult to hold everyone together long enough to complete the purchase. This is because some leaseholders may move away or drop out.
6. Once the conveyance for sale has been executed, the Freehold property is granted to the Leaseholder or Collective Enfranchisement Company nominated by the group. Immediately following the acquisition, new leases are granted to the other Leaseholders with the new term of 999 years.

What if the Freeholder does not agree to the sale?

• If you are not able to negotiate with the Freeholder on an amicable basis, you can compel the Freeholder to sell to you by application to the Leasehold Valuation Tribunal in Central London.

What happens if the Freeholder cannot be found?

• If your Freeholder is missing, you can apply to the Leasehold Valuation Tribunal to make an Order of Sale (a Vesting Order). It will not do so, however, unless strenuous steps have been taken to trace the owner. For this purpose, Pro-Leagle offer a Freeholder-tracing service.

How long does it take?

• If all goes smoothly in that the Freeholder offers to sell at the price you volunteered or at a price acceptable to you, and the other leaseholders are willing to share the costs, the process could take approximately two months.
• Nevertheless, if the Freeholder is either difficult to track down or unreasonable, application to the Leaseholders Valuation Tribunal to force the sale can be made, and this could take approximately twelve months.
• Further complications with indiviudal Leaseholders could result in a delay in Collective Enfranchisement.