Repossessions

lynseydee

Is there any reason not to consider buying a repossessed house? I know there was a time where it would affect your credit rating but not sure if that's the case anymore.

sonastin

Credit ratings aren't affected by the house you live in. Unless you are otherwise financially linked to the former owner, purchasing the repossession won't affect your credit rating.

However, some other things to be aware of when buying a repossession:
- the house will stay on the market until you exchange contracts, increasing the chance of being gazumped
- your offer will be advertised publically to give others the chance to gazump you
- the house is "sold-as-seen" so you can't get the vendors to change or fix anything. chances to renegotiate the price following survey are seriously limited
- you'll be set what appears to be a ridiculously tight timescale to get to exchange (usually 28 days, sometimes less). provided you have made good progress towards being ready, you don't need to worry about the deadline too much but you need to make sure that your solicitor and mortgage lender are aware that this is a repossession and you need a quick turnaround.

Generally the purchase process with repos is much more stressful and the house you end up with can be full of nasty surprises but equally the price can often reflect the state of the property so it is possible to get a good deal. Which increases the chance that others would want it too hence the stress of being gazumped etc. But if you've found the right house and you can handle the stress, don't worry about the fact that you are purchasing from a bank.

kingstreet

Other than your offer being in the public domain and the property being actively marketed right up to exchange, there's nothing wrong with buying a repossession.

I don't ever remember someone's "credit rating" being affected by the property they purchased.

lynseydee

sonastin wrote: »

Credit ratings aren't affected by the house you live in. Unless you are otherwise financially linked to the former owner, purchasing the repossession won't affect your credit rating.

However, some other things to be aware of when buying a repossession:
- the house will stay on the market until you exchange contracts, increasing the chance of being gazumped
- your offer will be advertised publically to give others the chance to gazump you
- the house is "sold-as-seen" so you can't get the vendors to change or fix anything. chances to renegotiate the price following survey are seriously limited
- you'll be set what appears to be a ridiculously tight timescale to get to exchange (usually 28 days, sometimes less). provided you have made good progress towards being ready, you don't need to worry about the deadline too much but you need to make sure that your solicitor and mortgage lender are aware that this is a repossession and you need a quick turnaround.

Generally the purchase process with repos is much more stressful and the house you end up with can be full of nasty surprises but equally the price can often reflect the state of the property so it is possible to get a good deal. Which increases the chance that others would want it too hence the stress of being gazumped etc. But if you've found the right house and you can handle the stress, don't worry about the fact that you are purchasing from a bank.

kingstreet wrote: »

Other than your offer being in the public domain and the property being actively marketed right up to exchange, there's nothing wrong with buying a repossession.

I don't ever remember someone's "credit rating" being affected by the property they purchased.

That's really helpful, thank you. Maybe I'm thinking of something else with regards to the credit rating.:o

The property has been on the market since the end of February and I did wonder why it hadn't been snapped up by an investor or something. The above definitely gives us something to think about.

Also our house is on the market and although we have somebody who is potentially interested they haven't committed yet and put in an offer. If as you say the repossession could expect a quick turnaround it may be better to wait until we have a firm offer on the table before we do anything else.

kingstreet

Until you've got firm interest, there's no point you trying to offer on the repo. They simply won't deal with you until you're in a position to proceed quickly.

lynseydee

kingstreet wrote: »

Until you've got firm interest, there's no point you trying to offer on the repo. They simply won't deal with you until you're in a position to proceed quickly.

I wouldn't have thought of making an offer until I knew what position we were in. We haven't even viewed it yet so might help to do that first :rotfl:

celyn90

Be prepared to be really stressed and have the budget to up the offer quickly if you get gazumped.

We have had to up our offer twice on the house we want to buy. It's really frustrating.

There is also likely no paperwork with the house. cel x

lynseydee

celyn90 wrote: »

Be prepared to be really stressed and have the budget to up the offer quickly if you get gazumped.

We have had to up our offer twice on the house we want to buy. It's really frustrating.

There is also likely no paperwork with the house. cel x

I know house buying/selling can be really stressful (in fact I vowed never to do it again after last time) but I think we would need to decide beforehand what our limit would be and if they weren't prepared to go for that then we would just have to walk away, no matter how much we liked the house. There are other houses on the market that we like the look of but I think the appeal of this one is that hopefully we can borrow a bit more on the mortgage and get a new kitchen and bathroom put in but still have an affordable mortgage.

kingstreet

lynseydee wrote: »

I wouldn't have thought of making an offer until I knew what position we were in. We haven't even viewed it yet so might help to do that first :rotfl:

Cool. You might have said you haven't viewed it yet!

GDB2222

One appeal of repos is that you know they are definitely for sale. With other properties, the vendor can change their mind about selling altogether if they can't find what they want or their circumstances change.

tyllwyd

If it has been on the market since the end of February, there might well be someone in the process of buying it - reposessions don't get marked as under offer. So I'd phone up the EA and ask that question before you go any further.