Structural faults when buying auction property- help needed urgently!!

charliefinn

My dad has just recently bought at auction and has found himself in a bit of a predicament.... i will explain in a nutshell... Im not the most wise about the property market but would be very grateful of and advice and information you could provide me with.

The property was an online auction and had a 'guide price' of £95,000 for a 3 bed detached (this is particularly good for our area location) so my dad put in an offer (122,000) -it was accepted and taken off the auction which was due to take place on Tuesday morning.
After the offer was accepted he went to the estate agents to pay the 10% deposit which is required once you commit yourself to buy...this was carried out but is currently pending and wont leave his account until Monday morning.

As my dads intentions were to buy this property and then sell on again (to make a profit) he rang his local estate agent (i cannot mention for confidentiality) that he has been a good client with for a number of years to get a guide price of what the property was worth. To his shock we found out that the property has structural faults (front porch and apparently is pulling away from the other semi) as it had previously been on the market before but didnt sell several times as it was un morgagable

To get to the point of what i would like to know is.....

When selling a property through auction does the vendor not need to state that there is structural faults?

Should they not state 'cash buyers only' so that buyers are weary and expect there to be something that needs rectifying with the internal/external.

Are they legally entitled to cover up things like this?

What are my dads rights on pulling out of the deal and getting his 10% back?

I have done a little research and found info on Property Misdescriptions Act 1981....but i dont know what other sources of information may be helpful in finding out his rights and what the seller should state when selling in auction conditions.

I am aware that if the structural damage is as a result of the foundation not being correct it could be a disaster for my dad and in the worst case the property may need 'underpinning'

Please any advice will be most appreciated

ILW

Did the listing say the property was structurally sound?
If not he hasn't got a leg to stand on and will most likely be sued for the balance.
Commiting to purchase a property at auction unseen and without getting a survey done is just plain stupid. Sorry.

kazwookie

I thought for all auctions, it is up to the indending purchaser to make all necessary searches and such like before bidding / making an offer.

I would suggest he / you need to read the small print of the online auction T & C as ibet there is a clause to that effect somewhere.

Radiantsoul

Auctions generally require the buyer undertake all searches.
I suspect the best you can hope for is to either complete the purchase and underpin the property or to prepare to be sued for the whole sum.
Underpinning is going to cost tens of thousands...

withabix

The best thing he can do is move into that house and sell the one he is living in!

Either that or put it back up for auction an cut his losses.

Why on earth did he think that it was so cheap?

Face....Palm

charliefinn

ILW wrote: »

Did the listing say the property was structurally sound?
If not he hasn't got a leg to stand on and will most likely be sued for the balance.
Commiting to purchase a property at auction unseen and without getting a survey done is just plain stupid. Sorry.

im not so sure...all paperwork/documents went straight to our solicitor who i am unable to contact untill Monday morning...i know he feels maybe he rushed things a bit but is hoping that the structural fault isnt something to nasty thats going to cost too much to sort out . He is also hoping that there is somekind of buyers protection that he should be informed upfront of any faults like this when purchasing??....i dont know...its a bit of a worry :0(

charliefinn

kazwookie wrote: »

I thought for all auctions, it is up to the indending purchaser to make all necessary searches and such like before bidding / making an offer.

I would suggest he / you need to read the small print of the online auction T & C as ibet there is a clause to that effect somewhere.

I dont know...everything was literally done within 24 hours so there was no time for any investigations on the structure...the deposit had to be paid that day or it would of gone to auction. I will be in touch with the solicitor monday morning to see what his rights are and if there is anything in the documents that will work in my dads favor

Thanks for help

neas

He wanted to make a tidy profit from their urgency to sell...greed got the better of him and i guess he should be happy with his 10% loss....

Sucks but its caveat emptor.. buyer beware. He didnt do searches and gambled his cash and lost.

Im sure the 10% is gone. Dont worry he can make that back on the next property he buys,

clutton_2

""He is also hoping that there is somekind of buyers protection that he should be informed upfront of any faults like this when purchasing"

non - there is nothing like that... you dont seem to have accepted any of the posts above which tell you that your dad has made a big mistake, that he is committed to buying it, and if he does not pay the balance he will be sued by the auction house..

ALL enquiries are up to the purchaser - he has made a bad error of judgment - and if the repairs prove too expensive i suggest he puts it straight back into a different auction as soon as he can and take the loss he will inevitably make......

Doozergirl

clutton wrote: »

""He is also hoping that there is somekind of buyers protection that he should be informed upfront of any faults like this when purchasing"

non - there is nothing like that... you dont seem to have accepted any of the posts above which tell you that your dad has made a big mistake, that he is committed to buying it, and if he does not pay the balance he will be sued by the auction house..

ALL enquiries are up to the purchaser - he has made a bad error of judgment - and if the repairs prove too expensive i suggest he puts it straight back into a different auction as soon as he can and take the loss he will inevitably make......

Completely right.

The first thing you look for on an auction property is what is wrong with it. There is almost always a reason why it isn't on the open market, you have to be pleasantly surprised if you don't find anything wrong.

Nothing was covered up, Your dad has been burnt by his own greed. You never purchase at auction without doing your homework. As he has handed over his 10% deposit he will have also exchanged contracts, regardless of whether or not that money has left his account he is legally bound to hand over that money, plus shoud he fail to complete, all the vendors costs associated with resale and (oh dear) any difference between his offer and the eventual selling price. Pulling out is not an option at this point.

How lovely you are for trying to help your dad, but he's a big boy and should have known what he was doing before he legally commited himself. It's greed that's got the better of him, everybody knows to find the issue with the auction property - there's no cover up. Pre-auction offers are for the naive as well - the room sets the market value so if everyone else has spotted the issue, the price won't move above a certain price so you're protected by a lack of competition.

Are we simply talking about a porch here? A porch would be easy to fix - either by tying it in, which may be the simple issue; underpinning would be inexpensive but wouldn't remove the stigma or you simply knock it down - no porch, no subsidence.

silvercar

Has he signed? If not there is still time to stop the payment going through and pull out. Without having signed the vendor only withdrew the property from the auction because they thought they had a buyer. Maybe the vendor should have kept the property listed until the money was received and the paperwork signed.

as your Dad hasn't actually bought at auction, he may be able to get out of the exchange.