'Modern auction method'

mjle

We offered and had it accepted on a property about to go into an auction. We had to pay 3K deposit, and 995 admin charge. 
The £3k deposit does come off the purchase price of the property though. 
I guess for us it worked, as we think we got a property for a good price? Everyones different though, and understand some people see the auction terms and just dismiss them.

eddddy

mjle said:

We offered and had it accepted on a property about to go into an auction. We had to pay 3K deposit, and 995 admin charge. 
The £3k deposit does come off the purchase price of the property though. 
I guess for us it worked, as we think we got a property for a good price? Everyones different though, and understand some people see the auction terms and just dismiss them.

That doesn't sound like what's generally called "The Modern Method of Auction".

That sounds more like a traditional unconditional auction.

When people talk about "The Modern Method of Auction", you're essentially bidding to buy a reservation - and the reservation fee is usually 5% of the bid price - often with a minimum of £5k +vat.

vanepico

Hi everyone, I thought I would add my experience on here too, about these unscrupulous practices, as so much useful information is already here.

They nearly had me over the barrel, I was getting ready to place a bid on a property, but it went too high for me to afford. With 10 minutes to spare on the auction, speaking on the phone (I think they actually rung me, talk about playing it cool!) to the blood-sucking estate agents who were in on the 'legitimate business transaction' with 'dryshambold', they tried to rush me into agreeing a larger mortgage with their onsite broker there and then. I was appauled that they would suggest someone jump into a £150k credit agreement in such short notice without chance to read any terms, or at the very least, get me to agree to hand over a £12k fee for a high bid!

In the end, the property, which needed significant renovation, went above market value (including the extra 6%) for the time. Shortly after the bidding finished, the sale price mysteriously dropped by 3k (looking suspiciously like a shill bid, considering I doubt they would let you withdraw a bid with their terms because they wouldn't get their wonga!). Within a few days the property was back up for auction, so I wonder if there genuinely was any other bidders, or if the '6 bidders' announced on the bidding history were synthetic puppets performing a pre-choreographed tango. With a company alleged in this thread to be using underhand tactics, why would one trust anything they say?

I did see that in the terms, they allow themselves to SHILL bid, which basically defeats any benefit of an auction, to naturally find what people are prepared to pay, I.e the market value!!

What makes me a bit bitter, is that it is the owners of the kind of property I am looking for, that are getting coerced into selling through this method, older doer-upper properties 😔

diane***

wow, i was considering entering into a contract on modern auction,  no longer considering it, but i really want the property.....ohhhhh and grrrrr,