Faqs Right To Manage Company Formation

Faqs Right To Manage Company Formation

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Making the decision to obtain the right to manage your building is a big thing to do, so it certainly pays to have a good understanding of the process before you make the commitment.

This article takes you through some common questions about forming a right to manage company, to give you a better idea of what it is and what it involves.

What is the right to manage?

The right to manage (or RTM) is the right of a group of leaseholders - usually in a block of flats - to come together and take over the management of the building from their current landlord. This involves the transfer of the freehold as well as a transfer of managerial responsibility.

Where does the right come from?

This right is granted by the Commonhold and Leasehold Reform Act 2002, which also lays down the procedure that you will need to follow if you are serious about right to manage company formation.

Am I eligible?

It is worth seeking advice about your eligibility, but generally if a leaseholder is going to be eligible then their original lease needs to be for more than 21 years. Also, you will need half of the leaseholders in the building to be qualifying tenants and the building will need to have more than 4 flats in it.

Do I need to set up a right to manage company?

Yes. You will need to come together with your fellow qualifying leaseholders and undertake the process of right to manage company formation as it is this company that will manage the freehold and other managerial responsibilities once the process is complete. This is to take account of the fact that leaseholders might move out, but the company will always be there.

Do I need to hire a right to manage solicitor?

Yes, you will need a specialist right to manage solicitor at various stages in the process, such as when forming your company, serving notice to your landlord and transferring the freehold once you have been successful.

What does it cost?

The cost of acquiring the right to manage varies from case to case, but you should be aware that you will need to pay solicitors' costs and also any costs associated with the transfer of the freehold as well as other miscellaneous costs (such as obtaining certain documents). You will also have to pay any charges accrued by your landlord over the course of the process.

Do the tenants have to carry out the maintenance?

No. Once you have completed RTM company formation and the freehold has been acquired, the company will have the responsibility for maintenance and repairs but you are able to hire someone to do this for you if you wish. This is definitely advisable for larger buildings.

What about the current landlord?

You will have to invite your current landlord to participate in your new RTM company but as long as you carry out the process properly and follow the correct procedures, they are not allowed to turn down your claim.

About the Author:
Thinking of setting up a right to manage company? Bonallack and Bishop are specialist right to manage solicitors - make sure you talk to them first on 01722 422300 today.



Article Originally Published On: http://www.articlesnatch.com


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