hi everyone. another question i've got here, lol. my building is factored or maintained and i've recieved my welcome letter from the company who provides this service. the thing that confuses me is that in the letter they say that they're going to charge me £37 every 6 months which is fine. but when i read on they say they encourage a direct debit of £25 a month to be set up. i was just wondering if someone could enlighten me as to why i would want to pay £25 a month instead of £37 every 6 months!lol. sorry if its a stupid question, i just wasn't sure what they mean. thanks
Hi you really need to get to the bottom of this 'cos £37 every 6 months sounds incredibly cheap.
When i lived in a (bought) flat we paid £X a month into our 'account' and any 'additional' work that was done (like major works such as replacing communal fixtures, excess repainting, etc) was charged to our accounts and then we were billed for any short-fall and the end of the year.
In other flats we looked at the monthly service charge was almost double the price of ours but then you were more or less guarentted that that there would be no short-falls. It is all about what the managment compnay want and how they go about it. Swings and roundabouts really.
However, it is almost impossible to say what is going on in your situation, without knowing all the facts. You'll need to consult your powers that be. My guess (based on what you've said) is that the £37 per 6 months is the standing maintaince charge and that you'll be required to put your hand in your pocket for excess works as and when they take place. Because of this the managment company may be encouraging you to put £25 a month into your 'account' (the figure should be based on what they believe they will have to spend in a year) so that you've always got some money to fall back on if they need to do major works.
This is only what i THINK it may be, based on what you've said and based on my own experiences.
A low maintenance charge is not that unusual if it's just paying running costs on a flat with low maintenance. I had one that cost about 200 a year. All we routinely shared was an insurance bill and the costs of lighting one bulb in the shared hall.
Cyclical redecoration was a different matter of course.
As to paying by DD, some people find them useful because it ensures the cash is put aside - sort of saving as you go. I'm a very disciplined person financially (and I'm very solvent) but I find this sort of DD good .
Vbland, what you have said is what i was getting at. 2X £37 a year is still very low, lower of coure than the the £200 you yourself had been paying, which is why i think that the £25 a month suggestion must be because each year (or period) there is going to be an expected short-fall, based i guess on what work was required througout the year above and beyond the routine maintainence which the 2x £37 a year covers.
My service charge was higher as it covered the cost of gardners and cleaners who maintained the communal areas, and what ever else was needed to keep the place ticking over. It was when they di 'major works' that we dreaded, 'cos one year the shortfall was £600+
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