subject: What Are the Costs Involved In Exercising Your Right To Manage? [print this page] What Are the Costs Involved In Exercising Your Right To Manage?
If you own one flat in a block and you are dissatisfied with the management service you are getting, you may decide to go through the process of setting up an right to manage (or RTM) company along with several other tenants. This is an involved process to go through, but it is also one that is reasonably straightforward in many cases.However there will be costs involved in the process, so it makes sense to be aware of these before you begin. Something to consider is that it will not be you alone covering these costs, even if it was you who started the process. However many tenants are involved in the whole right to manage process, the costs will be divided equally between all of you.There is a caveat with this though. If you are an elected director of the company you might become liable for debts owed if one tenant doesn't pay. This applies to the regular maintenance payments as well. Should a tenant decide to withhold their payments for some reason, or they simply cannot pay them, you will have to make sure you cover what they owe.As far as the initial costs are concerned, you will obviously have the solicitor's fees to bear in mind - and do make sure when you appoint a solicitor, that you pick one specialising in right to manage cases. However there are also other fees which will be payable by the newly formed company. For example when a company is created a fee should be paid over to Companies House. You will also be liable for the legal costs charged to your landlord. After all, he cannot reasonably be expected to pay for the process when he has not initiated it.You might feel like the fees are steadily increasing at this stage. But remember that you should not be the sole person to handle them. Every tenant who has a role in the new RTM company will have their share to pay, and this dilutes the total cost down considerably.You can probably see though that the right to manage a block of flats does come at a certain cost. It is always best to know about this in full before you embark on the process. The more knowledge you have before you begin, the happier everyone will be as the procedure takes place and eventually reaches its conclusion.
