• Retention Agreement/fee Concerning Service Charges

    By Guest on 19th Jan 2018

    I have recently sold a leasehold flat and the buyer's solicitor requested a retention of £500 to be held for 12 months on the basis that there may be a deficit in the service charge accounts relating to my period of ownership. I agreed to this on the basis that our solicitor told me that it is standard practice. However, no allowance is made for whether or not there is a surplus (as there has been each year for the past five years). The retention seems to have been set up in a one-sided way, benefiting/protecting the buyer but doing nothing for the seller. If there is a service charge surplus, this will be credited to the buyer and I will be subsidizing their service charges for their period of ownership of the property. Should there have been a retention fee paid by both buyer and seller? Please let me know your thoughts.

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