Repossessed Property Buying: Quick Briefing Discussion

sangriagal

I found a repossession property that I liked, made and offer, the offer was accepted, i had instructed my bank to send the 10% deposit in the morning 2 days prior to exchange, on that same day, in the afternoon, I was told the property had been removed from the market due to the previous owners making a mortgage payment. I believe the property has been misrepresented - has this happened to anyone else? I am now trying to reclaim the expenses so far - i.e. land searches, survey etc. Any help please?

harryhound

The seller pulled out before exchange of contracts in writing.
So I very much doubt that you have any legal remedy in English law. - but there have been one or two reports on her of people getting compensation in similar situations.
It may well revolve round what exactly you can prove you were told that you relied upon before you went and spent your money..

humphriess

Hi, i'm in the process of buying a repo (fingers crossed) Have an appointment thursday to exchange contracts. the completion date isn't until a week monday though (this would be 28 days). where do we stand once contracts have been exchanged? Do we have any legal advantage once the contracts have been exchanged? Can someone still put a higer bid in between exchange and completion? Thanks

Lou_Diamond

We went down the easy route and let somebody else do all the leg work. Me and the wife had been to atleast a dozen auctions and could never get a look in with all the favoured buyers there! So in the end we paid a company Instant Equity Portfolios Ltd to find us property discounted by 25% - 30% of market value. They only sell in bundles of five, but to be honest with only a small cash outlay we were able to get 3 suitable properties within the first two months of signing up, the 4th came at 6 months and the 5th after 10 months. We could of had all 5 at once but we wanted specific areas that we were comfortable with. Now all 5 properties have increased in value, are giving us a monthly rental income of £1272 across the five which is after we take out management costs, and a bit of maintenance. Although we didn't buy them for the rental, although the income is nice, we bought them for our pension pot. When we retire we will have owned all the properties for 17 years. A nice little nest egg, and not bad for a single investment of £30,000. We are now thinking that we could release another £30,000 from the equity we have in the existing five, and buy five more. We are working on the basis that we will be doubling our pension pot potential. Does anybody have any thoughts on if that is a good idea or not?

harryhound

If it does work, there might be a lot of inflation and 28% Value Added Tax embedded in the portfolio by the time you retire.

Jowo_2

A flat in my tenement in Glasgow was repossessed from the amateur property developers who fled to Thailand after remortgaging it to the hilt. It's up for sale with a conventional estate agent and appears to offer good value for money as it's been refurbished. However, I know that there is a note of liability on it for unpaid factors fees of at least £1,000. The collapsed bathroom ceiling seems to have been repaired but I doubt they tackled the root cause which is that the bathroom of the flat above is leaking. In addition, the property flooded in the winter when the pipes burst so there could be issues with damp, damaged flooring or the central heating. On the surface, it looks a good buy - a 3 bed flat for 2 bed prices in good nick but there are a host of issues lurking for a less diligent buyer.

GDB2222

Lou_Diamond wrote: »

We went down the easy route and let somebody else do all the leg work. Me and the wife had been to atleast a dozen auctions and could never get a look in with all the favoured buyers there! So in the end we paid a company Instant Equity Portfolios Ltd to find us property discounted by 25% - 30% of market value. They only sell in bundles of five, but to be honest with only a small cash outlay we were able to get 3 suitable properties within the first two months of signing up, the 4th came at 6 months and the 5th after 10 months. We could of had all 5 at once but we wanted specific areas that we were comfortable with. Now all 5 properties have increased in value, are giving us a monthly rental income of £1272 across the five which is after we take out management costs, and a bit of maintenance. Although we didn't buy them for the rental, although the income is nice, we bought them for our pension pot. When we retire we will have owned all the properties for 17 years. A nice little nest egg, and not bad for a single investment of £30,000. We are now thinking that we could release another £30,000 from the equity we have in the existing five, and buy five more. We are working on the basis that we will be doubling our pension pot potential. Does anybody have any thoughts on if that is a good idea or not?

Well, first I doubt that you are actually getting a discount of 25% below true market value. If you were, why wouldn't you just sell your properties and pocket an instant profit, then rinse and repeat? The proof will be in the pudding when you try to release equity from the existing portfolio - you may not like the valuation numbers the lenders come up with.

However, in answer to your question, any geared property investment does well when markets are rising and badly when they are falling. So, are you really, really confident prices will rise, and do you have a lot to lose if they fall?

silence12

I am a first time single buyer, purchasing a repo property through an estate agent. Property had been on the market for 52 days.

Property is a two bed House with newly installed kitchen, may need rewiring and a boiler. :eek:

Offer price: £155,000 (accepted) on a £200,000 - £210,000 street. :j
2 mins to new East London Line.
5 mins from National Rail Station
5 mins from Bus station

Just had the survey done today. :T

Awaiting exchange and completion - by the way my 28 days will expire on 12th August, however vendor has extended until the end of the month. :rotfl:

dan10000

Hi
Well done on your purchase! Could you tell me from what point the 28 days starts? Is it from the date of offer acceptance, advert in the paper or what?

Many thanks
Daniel.

silence12 wrote: »

I am a first time single buyer, purchasing a repo property through an estate agent. Property had been on the market for 52 days.

Property is a two bed House with newly installed kitchen, may need rewiring and a boiler. :eek:

Offer price: £155,000 (accepted) on a £200,000 - £210,000 street. :j
2 mins to new East London Line.
5 mins from National Rail Station
5 mins from Bus station

Just had the survey done today. :T

Awaiting exchange and completion - by the way my 28 days will expire on 12th August, however vendor has extended until the end of the month. :rotfl:

kinnth

Hello All,

I am a first time buyer and I have entered into a deal to buy a repossessed property. The property is a 2 bed Flat and I am going to live in the house for a year and do it up (Having looked at the house it is in good nick with only superficial damage which I expect to cost me 1-2,000 to repair). Now I had put in an offer of 110,500 which was accepted and I have a mortgage agreed. However, due to all the large number of articles and news stating that house prices are still falling and no one is buying I want to play hardball and amend my offer.

I have not had the survey done but I have paid for the solicitors and £100 for the mortgage in principle as well as my mortgage broker, so all in all I am £1000 down. I really want to offer roughly £105,000 but I want advice how best to word it. I am not in a situation where I need the house but I want to try and get the best deal.

What would be your thoughts on how to play it?