Late payment fees and interest
Discussion
In 2000 we moved from a flat to a house, paying off the flat mortgage and keeping it to rent out. At his time we wrote to all our banks and other service providers to advise our new address, this included the flat's freeholder.
The freeholder then invoiced us for annual ground rent at the new house address. This worked well for 7 years until in late 2007 they advised us that they were selling the freehold and that we would receive further information later to explain who the new freeholder was.
We heard nothing more until Christmas/New Year 2008 when the then tenant at the flat brought us a letter/statement claiming 2008's ground rent plus late payment and interest charges. This was the first correspondence received from the new freeholder. We had moved out 7-8 years previously so there is obviously no postal redirect still in place, mail is dumped in a communal area and 'junk' is regularly cleared out by the management company. If anything else was sent to the flat it was 'lost'.
I immediately paid the outstanding ground rent and in a lengthy phone call with the company representing the new freeholder explained the above and said I didn't see how I was liable for fees and interest as we hadn't been invoiced at the notified address. They said they would talk to their client.
About 2 months later they wrote to us saying they would half the charges. We wrote back stating the facts again and saying we still didn't agree. We have sent 2 reminders since then and received no reply. We have carried on paying the ground rent which they now invoice to the house address.
We paid 2011's ground rent on time 2 weeks ago. This week we have received a letter saying that they will be adding another late payment fee to the account and threatening legal/collection action. As we are up to date with ground rent this would be against previous late payment fees and interest.
I have 2 questions.
Are we liable for late payment costs at all when it is the new freeholder who has changed a successful billing arrangement?
Since finding out where to send payment we have kept fully up to date with ground rent payments. Are they allowed to add interest and further late payment fees to a balance that is only made up of late payment fees? Am I correct in thinking that interest should stop when the principal is paid?
Thanks for any advice.
The freeholder then invoiced us for annual ground rent at the new house address. This worked well for 7 years until in late 2007 they advised us that they were selling the freehold and that we would receive further information later to explain who the new freeholder was.
We heard nothing more until Christmas/New Year 2008 when the then tenant at the flat brought us a letter/statement claiming 2008's ground rent plus late payment and interest charges. This was the first correspondence received from the new freeholder. We had moved out 7-8 years previously so there is obviously no postal redirect still in place, mail is dumped in a communal area and 'junk' is regularly cleared out by the management company. If anything else was sent to the flat it was 'lost'.
I immediately paid the outstanding ground rent and in a lengthy phone call with the company representing the new freeholder explained the above and said I didn't see how I was liable for fees and interest as we hadn't been invoiced at the notified address. They said they would talk to their client.
About 2 months later they wrote to us saying they would half the charges. We wrote back stating the facts again and saying we still didn't agree. We have sent 2 reminders since then and received no reply. We have carried on paying the ground rent which they now invoice to the house address.
We paid 2011's ground rent on time 2 weeks ago. This week we have received a letter saying that they will be adding another late payment fee to the account and threatening legal/collection action. As we are up to date with ground rent this would be against previous late payment fees and interest.
I have 2 questions.
Are we liable for late payment costs at all when it is the new freeholder who has changed a successful billing arrangement?
Since finding out where to send payment we have kept fully up to date with ground rent payments. Are they allowed to add interest and further late payment fees to a balance that is only made up of late payment fees? Am I correct in thinking that interest should stop when the principal is paid?
Thanks for any advice.
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