Hidden cost of exercising the right to buy: The dream of ownership becomes a nightmare for a former council tenant faced with a huge service charge. Caroline Merrell reports

The Government's right-to-buy initiative seemed to give council tenants a cheap way of buying into an apparently unstoppable housing boom.

However, more than 10 years after the event, the dream of home ownership has turned sour for some. In one case, a former tenant had her home repossessed by Abbey National after arrears were increased spectacularly by a pounds 24,000 service charge levied by the council.

Mair Slattery bought her three-bedroom flat with her husband at a discount for pounds 18,000 in 1983. The property was one of 16 flats in a block in north London. About half the tenants decided to buy their properties. Abbey National provided the original loan for the Slatterys' flat.

Five years later Mrs Slattery decided to take out a further loan from Abbey National of pounds 12,000 for improvements that included replacing the windows and adding a bathroom, to bring the mortgage to pounds 30,000. The flat was then valued at pounds 60,000.

In 1990 arrears began to build up on the property. By March 1993 they had mounted to pounds 1,500. Mrs Slattery, a health authority worker, said: 'With the poll tax, I was finding it difficult to pay the mortgage.'

The problem was then made worse by Harrow Council, which added a service charge on the flat of pounds 24,000. The charge helped pay for a new roof and fire escape for the block. It also helped pay for new windows - in Mrs Slattery's case this involved ripping out windows she had borrowed money to install, because the council also wanted to put new insulation into the block. The tenants who had not bought their properties did not have to pay the service charge.

The Abbey National view is that in situations of this kind, when the borrower cannot pay a service charge, the lender pays it then adds it to the arrears on the property. An Abbey National official said: 'If we didn't do this we would have no security for our loan.' If the lender did not pay the service charge, then the council would gain possession of the lease.

Mrs Slattery said that she could not believe the size of the charge. 'The whole thing had started to turn into some sort of nightmare.'

Abbey National began court proceedings against Mrs Slattery for repossession in May last year. Jacqueline Bunce- Linsell, her solicitor, managed to stave off repossession by paying pounds 10,000 from money Mrs Slattery had inherited. Abbey National then reorganised Mrs Slattery's repayments so that she could repay the arrears at pounds 130 a month as well as the outstanding loan. Her difficulty was exacerbated because the addition of a service charge on her loan meant that it was no longer eligible for tax relief.

Again she began to run into difficulty, and last week Abbey National reinvoked the repossession order and locked her out. That decision was only reversed after Mrs Slattery's brother-in-law paid off the arrears through his Abbey National deposit account last week.

Derek Wiseman, a councillor with Harrow Council, said that Mrs Slattery had been the worst-hit of those paying the service charge. He said: 'Different people in the block paid different maintenance charges according to when they bought the property.' He said that the problems with the property had been brought up at a council meeting.

The council said Mrs Slattery had exercised her legal right to buy; it was incumbent on the buyer to have a survey carried out. The council was satisfied that it had acted fairly and within the law.

(Photograph omitted)

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

Day In a Page

Refugee crisis: David Cameron lowered the flag for the dead king of Saudi Arabia - will he do the same honour for little Aylan Kurdi?

Cameron lowered the flag for the dead king of Saudi Arabia...

But will he do the same honour for little Aylan Kurdi, asks Robert Fisk
Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Humanity must be at the heart of politics, says Jeremy Corbyn
Joe Biden's 'tease tour': Could the US Vice-President be testing the water for a presidential run?

Joe Biden's 'tease tour'

Could the US Vice-President be testing the water for a presidential run?
Britain's 24-hour culture: With the 'leisured society' a distant dream we're working longer and less regular hours than ever

Britain's 24-hour culture

With the 'leisured society' a distant dream we're working longer and less regular hours than ever
Diplomacy board game: Treachery is the way to win - which makes it just like the real thing

The addictive nature of Diplomacy

Bullying, betrayal, aggression – it may be just a board game, but the family that plays Diplomacy may never look at each other in the same way again
Lady Chatterley's Lover: Racy underwear for fans of DH Lawrence's equally racy tome

Fashion: Ooh, Lady Chatterley!

Take inspiration from DH Lawrence's racy tome with equally racy underwear
8 best children's clocks

Tick-tock: 8 best children's clocks

Whether you’re teaching them to tell the time or putting the finishing touches to a nursery, there’s a ticker for that
Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement