First Time Buyers at Auction

B2_LNW

Hello fellow moneysavers,

My partner and I are after some advice, we have seen a property which is going to auction on the 30thNovember. The guide price is £100,000 Plus. We have been saving for a deposit but weren't planning on looking until next year. We have £6250 saved so far. But when reading the details of buying at auction it needs a 10% deposit. We were wondering if this could be paid from the mortgage? For example we get a 95% mortgage, could we get the bank to write a cheque for the rest of the deposit?

Also does anyone know the best place to get a mortgage on our wages.
I am a builders apprentice and get paid £256 a week. This is £13,312 a year, I also work on sundays which brings in £2,600. Total £15,912
My partner is a junior estate agent and gets a salary of £10,000 per annum. This is due to go up within the nest fortnight.

Also how much should we budget for other costs? For example conveyancing, auction fees (£235 I think)

We are considering putting in an offer at around £106,000 before the auction? Any thoughts???

We looked on nethouseprices and the last 2 properties that sold down this road were £152,000 and £152,500. We haven't viewed the property yet but it all seems in good order with not much work needed.

Please ask if anymore detail required.

Would really appreciate all responses

nrsql

http://www.bbc.co.uk/homes/property/buying_auction1.shtml

>> Make financial arrangements to ensure you have a 10% deposit ready for payment on auction day, when the contracts are signed and access to the remaining 90% within 28 days.

You could probably get the deposit from the mortgage if you could arrange for it to complete on the day of the auction - which would mean exchanging cotracts and completing on that day - including searches and such. But considering you don't even know the purchase price then the answer would have to be no, it would need to be a loan.

Robert_Sterling

Beware ...
You appear to be walking into a minefield ...
Beware.

maryjane01

The guide price is often well below what a property sells for and houses go for close to market value at auction these days. If houses sell for £150,000 on the road, expect it to sell for close to £150,000, not the guide price. I went to an auction interested in a property with a guide price of £180,000. We had a budget of £270,000 and it went for £299,000. If all you can afford is £106,000 I probably wouldn't bother wasting my time if I wree you.

B2_LNW

Hi everyone, just one more question, we have spoken to a mortgage advisor and have been told we can borrow £110,850 over 15 years 4 months.can anyone help me work out the actual cost?
For example if the rate is 5% how much would the total cost be?
We are trying to get the monthly amount.
Many thanks

herbiesjp

Has your adviser not given you the costs?

Ian_W

B2_LNW wrote:

Hi everyone, just one more question, we have spoken to a mortgage advisor and have been told we can borrow £110,850 over 15 years 4 months.can anyone help me work out the actual cost?
For example if the rate is 5% how much would the total cost be?
We are trying to get the monthly amount.
Many thanks

Eh!! Come again?

A mortgage advisor has told you that you can borrow this amount but not what the monthly costs are? Did s/he say who the lender was - cos some would lend you that amount, whereas others wouldn't? And why 15yrs and 4 months? That's a rum period, when 25yrs or even 30 is the norm? Something distinctly not right here, IMO.

Like the others I'd have serious doubts you're going to be able to buy at auction given your budget and deposit situation. Can understand with your occupations wanting to get a property you can add value to - but blame Sarah, every man and his dog wants the same thing!

advent1122

For auction property you can safely add 30% to the guide price.

Gorgeous_George

A quick calculation gives a repayment of £876.59 at 5% over 15 years. Not quite the 15 years and 4 months. Unless you are the world's oldest builder's apprentice I cannot guess why it's such an odd term.

That must be about half of your joint net income. £595.07 over 30 years may be more practical. It's more important to know what the gas, electric and other household bills than conveyancing fees and other one-off payments associated with house buying, when working out affordability

I'd love to buy a house at auction - must be such a buzz bidding! Nearest I came was when I noticed a house for sale at £20K (yes - twenty). It ws on the market for 6 months and about to go to auction so I offered £15K. The agent said if I offered £15,500 it was mine. Two weeks later, I had the keys!

I echo everybody else's sentiments. Likely to sell £140K - £160K.

Best wishes



GG

306NOTOUT

I think you really need to go and look at the house before you think of doing anything else. I looked at a house on saturday and it looked great from the outside, it was on the market at £100k. I took a builder with me and knew from his face as soon as we walked in the door it was no good. It needed £30k spending on it easily and would only be worth £130k after all that effort.

Sassers

Hi there! I went to auction four times and saw countless houses...The upshot was I `lost' the house I wanted by £1500 to a letting agent well known in our area. I did have the deposit also I had a mortgage offer of up to 60k (which I know isn't a lot, but to me it was) all ready to go. I'm glad I `lost' this property in the end because when I did eventually buy my house, a certain company lost the papers twice. I was told the buyer was ready to pull out the sale within five hours. It was only faxing the Chief Executive threatening court action and exposure in the national media that got me through it...
Sorry gone a bit orf thread, but within the auction's 28 day deadline I would have most certainly lost my deposit....
Thanks
love Sas x