• Dissolved Management Company

    By Guest on 13th Mar 2014


    We are in the process of buying a house which is a leasehold. Everything was going to plan until it came to light that the freeholder, a limited management company, had dissolved in 2006 and didn't release the freehold. Therefore, it has become bona vacantia. Our solicitor has said that this means our mortgage would be declined now on this basis. However, our vendor is telling us that an indemnity policy would solve this issue. In return our solicitor is saying this would only cover 'absent landlords' rather than a dissolved company. Who is correct? And is there an insurance policy which can resolve this matter?

    Any help greatly appreciated!


  • 2 Answers

    By Guest on 16/03/2014


    A lot depends on what the freeholder is obliged to do under the terms of the lease. Generally where the property is a house rather than a flat the landlord only collects rent and does not manage the property (i.e. you are responsible for insuring and maintaining the building). If that's the case then "Absent/Insolvent Landlord" policy should be acceptable. The term of the lease is a factor as well. Many houses which are leasehold will be let on 999 year or 250 year leases. If this is the case here then there are n concerns about what will happen when the lease needs to be extended because the lease only really needs to be extended when you get down to about 70 - 75 years left. Even if that point is fairly close though there are statutory provisions allowing you purchase the freehold where the landlord is unable or unwilling to respond. You should keep in mind of course that your lawyer is in full possession of the facts whereas I am not, and your lawyer is the one you are paying to advise you, so you should think seriously before considering going against that advice.

  • By Guest on 04/08/2016

    Hi David. i just came across your post and we are now in a similar position. i was wondering whether you managed to find a solution to this problem.



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