Leaseholders have separate accounts for the general service charge and major repair service charge. The general service charge covers housing services which are provided on a frequent an on- going basis, such as gardening, cleaning, caretaking. The general service charge also includes an annual contribution to the cyclical works sinking fund. The cyclical works sinking funds helps meet the costs of redecorating the internal communal areas and external areas of blocks which are carried out every six to seven years. The sinking fund is reviewed every year to ensure contributions made by leaseholders are sufficient to cover the costs of cyclical works. The general service charge is set every year and leaseholders are advised of what the charge will be for the forthcoming year in the projected service charge statement which is sent out in February. The general service charge is divided in to 4 equal amounts which are debited to leaseholder accounts every quarter.
The major repair service charge covers all major repairs which are carried out to the fabric and structure of blocks or to the estate communal areas, such as renewing roofs, replacing windows or repairing paths. Major repairs can lead to large bills for leaseholders and by having a separate account leaseholders can make provision for major repairs by making payments into their major repair service charge account in advance of the works being carried out. We inform leaseholders in the projected service charge statement if we intend to carry out major repairs and what the estimated costs of the works are. We expect leaseholders to clear their major repair account when the audited statements for the previous financial period and payment demand letters are sent each September. Your major repair service charge account has the prefix LH i.e 100100 (general service charge account) and LH100100 (major repairs account).
Under the terms of the lease Hastoe reserves the right to charge 5% interest above base rate on outstanding balances if your service charge account is not clear within 21 days from the date of the audited statement.
If you are a shared owner the service charge you pay is included in your rent. Service charges pay for communal services which are provided on a regular basis, such as grounds maintenance, cleaning, sewage pumps. Shared owners should only pay the reasonable costs of these services and therefore the service charge is based on the actual cost of providing the services and what proportion you should pay depending on how many units receive the services.