Glossary of terms
Consultation: This is the legally defined process that we go through when we tell you about expensive works and contracts.
Covenant: This is an enforceable rule/right/responsibility, for instance a leaseholder’s covenant to pay the service charge.
Forfeiture: This is where the lease is ended by a formal legal process because the leaseholder has broken the lease. This course of action only takes place for substantial breaches of the lease covenants and following a decision of a court or Leasehold Valuation Tribunal.
First-tier Tribunal (Property Chamber) previously known as the Leasehold Valuation Tribunal: This is an independent and impartial body which makes decisions about service charge and other leasehold disputes.
Term: This is the number of years of the lease for the leaseholder. The length of a standard lease is 125 years.
Notice of assignment: When the property changes hands when either the property is being sold or someone is being added/removed on the existing lease.
Notice of charge/mortgage: When you remortgage / or go to another lender, the bank will usually want us to sign and stamp their notice. A fee will usually be payable for this and the current Administration Fees are shown on the Useful Links page.
Section 125 notice: This is the notice of the Right to Buy purchase price which sets out major works costs for the first five years of the lease, and the estimated Service Charge for the property if applicable.
Service charge: This is the charge that is made to leaseholders in return for the services provided by the landlord. The service charge is variable and the payment terms are set out in the lease for the property.
Sub-letting: This is when you let your home to someone else. You will then become a landlord and will then have legal responsibilities for your tenants. You must let us know if you sub let your home otherwise you will be in breach of a covenant.
Sinking Fund – Contributions are paid to the sinking fund for the property through the annual service charge and can be used for the repair and renewal of the major components of the property. The sinking fund remains with the property if it is sold.