What happens if you don’t pay ground rent?

The breakout of the notorious ground rent scandal took a majority of the leasehold homeowners by a surprise, and it has left them perplexed regarding the ground rent payment. A majority of the leaseholders, who were not familiar with paying ground rent, are not reluctant to pay the ground rent to the landlord. Let’s have a look at what happens if you refuse to pay the ground rent to your landlord:

What is ground rent?

Leasehold homeowners are obliged to pay ground rent as a payment to their freeholder or landlord of the property owned by them. Paying ground rent is a part of your lease contract, and you should pay up to £100 to £200. Your lease contract should stipulate your responsibility to pay the ground rent to freeholder on an annual basis.

What happens if I don’t want to pay my ground rent?

Leaseholders are required by the law to pay their ground rent to the freeholder of the property. Hence why it has been nicknames the ground rent scandal. However, if a leaseholder is not adamant on paying the ground rent then, the freeholder reserves right to request the court to file repossession of the property. The execution of such action is known as forfeiture, and it should be avoided on accounts of a leaseholder. A freeholder can start taking action only if:

  • A leaseholder hasn’t paid the ground rent for three years consecutively.
  • A leaseholder owes more than £350 of ground rent along with miscellaneous administration and service charges.

A freeholder might be inclined to drop the case, if a leaseholder is obliged to settle down the arrears within four weeks. If you pay the debt successfully—the freeholder would discontinue the course of the legal action against you.

In addition, if a homeowner fails to repay the ground rent arrears despite the legal action from the court then, it might provoke the freeholder to use bailiffs, or enforcement agents to evict the property. If you have any pending ground rent on your tab, we strongly urge you to repay it before it results in your eviction.