Assets

Assets

We recognise there is a fundamental need to secure your business critical assets, from vacant land, development sites and compounds, to plant, materials and fuel. As a leading provider of sustainable security, we are perfectly positioned to secure, monitor and protect your valuable assets.

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Allowing Leaseholders To Pay Service Charges By Instalments

Allowing Leaseholders To Pay Service Charges By Instalments
Allowing Leaseholders To Pay Service Charges By Instalments

There may be times where a leaseholder is struggling financially and they find themselves unable to continue paying their service charge in full each month. In these cases managing agents or directors will allow those leaseholders to pay by instalments. The question is, is this a good idea?  

In some cases, the financial difficulties that result in a leaseholder not having the funds to pay their service charge are temporary. If they have always paid their service charges on time prior to having these difficulties, then it managers may think it is better to give them the benefit of the doubt and allow them to pay by instalments for a short period.  

Difficulties may arise, however, if paying by instalments becomes a habit the terms of a lease make no provision for. Once you step outside of the terms of the lease then things can be problematic when there is no agreement that paying by instalments is acceptable and it isn’t put down in writing.  

As a managing agent you will then have to consider if the shortfall impacts on your ability to effectively manage a property. If this is the case, then all the other leaseholders may feel the impact of having insufficient funds. 

Another consideration is the resources you have at your disposal. Someone will be required to manage payments by instalments which will inevitably take more time to manage.  

While the decision to allow instalments should be taken on a case by case basis, it is important to balance the need to keep good relationships with leaseholders against the need to ensure that adequate levels of service charge funds are maintained.  

For more assistance please call one of our specialist team on 0800 002 9049.

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