Would you buy a repossessed property?

desperadoV2

Hello all,

I found a repossessed property for sale. It was bought (new build) on 2004 for 217K but currently on sale for 200K. Its a newly built property in a very good condition and vacant possession. It has been on the market for 4 weeks now.

My question, would you buy a repossessed property? I thought of putting in an offer of 180K to start but kinda feel bad because it was once a home of a person/family. Also I'm surprised the property is 17K less and still hasn't been sold out.

Would you buy a repossessed property?

Doozergirl

Yes. Have done several times.

Also, I would not feel embarassed about making low offers (I'd be making lower than that!) as you don't really know the story behind the reposession as it isn't always a family home. For this house to have been reposessed after being bought in 2004, it's a pretty easy guess that these people didn't make many mortgage payments at all.

Go for it - go in low and keep your subsequent incremental offers small. You'll hit the mortgage company's reserve at some point and they will accept.

IainBUK

I live with my parents in a re-possessed house

bobsa1

Yes I've bought quite a few and currently live in a house that was a repo. If you don't buy it someone else will. You don't know the story behind the sale of any property so I really wouldn't worry. I'd be offering much lower than you are thinking of. Probably £170k

desperadoV2

Doozergirl, bobsa1

so should I put in an offer less than 180K then? But it was a newly built property (built in 2004) and I checked nethouseprice.com and the property was bought in june 2004 for 217K. So it is already 17K less then the original price. If I put in an offer of 170K, won't they laugh at me? I'm worried they may not take me seriously if my offers are that low?

What do you think?

Doozergirl wrote:

Yes. Have done several times.

Also, I would not feel embarassed about making low offers (I'd be making lower than that!) as you don't really know the story behind the reposession as it isn't always a family home. For this house to have been reposessed after being bought in 2004, it's a pretty easy guess that these people didn't make many mortgage payments at all.

Go for it - go in low and keep your subsequent incremenal offers small. You'll hit the mortgage company's reserve at some point and they will accept.

bobsa1 wrote:

Yes I've bought quite a few and currently live in a house that was a repo. If you don't buy it someone else will. You don't know the story behind the sale of any property so I really wouldn't worry. I'd be offering much lower than you are thinking of. Probably £170k

Doozergirl

New builds are rarely worth what people paid for them so I wouldn't even use that price as a benchmark.

Yes, I'd start as low as you dare. I'd probably go in around £170k too. They will take you seriously as long as you have finance in place. ie. get a mortgage decision in principle asap! You need to provide proof with your offer.

The EA also has to be on best behaviour with a reposession as they have to leave a thorough paper trail as it stands to be audited. That means documenting all offers. Therefore, you stand a better chance than with most of actually getting a cheeky offer through.

Bear in mind that it is always possible for people to gazump you with a repo but it's never happened to me yet, touch wood.

bobsa1

Agree with Dozergirl. You stand a reasonable chance of a low offer with a repo, but you need to move quickly, usually within 28 days. Give it a try, you can always increase the offer if necessary

adept

If you were going to buy a repossession (house) where would be a good source of funding and could you get a free period to renovate the property before moving in?

welshcakes

Repo's can be a good investment especially if you are thinking of a BTR in a desirable area. The mortgage company is looking to get back their loan and the longer a property is vacant, the more likelihood of potential vandalism, damp, spiralling maintenance etc. Go for £170k - they can only say no and as stated before, at some point, little increases in your offer will hit the mark at some point.

New build are just like new cars - as soon as you drive them off the forecourt, they've significantly decreased in value.

Milky_Mocha

I'd say go for it, yes. Bid low as suggested and also bear the following caveats in mind: http://uk.biz.yahoo.com/ftb/repossessions.html

One of those caveats is that many repossessed properties are not in the most desirable of areas. Most people facing repossession try to sell the house themselves but when the property has been on the market so long their time runs out. I found a repossessed house (also bought from new by the owners; which area is yours in, I wonder?) and I subsequently found that although it was a beautiful area visually and looked like it housed decent people, properties there struggle to sell.

On another semi-related note, It always puzzles me why most repossessed properties have been damaged, usually deliberately. According to the EA, the owners damage it out of spite at losing their home. Surely its in their interest for the house to fetch the highest price and damaging it is not going to go in their favour? I still don't understand that one?

$17mma

We have just purchased a repo and got a great deal. I say go for it. We originally offerd the then seller a decent price and they declined our offer.

Then house got repossessed and bank invited us to make another offer and got the house for 30k cheaper than we offered the then owner :j so he lost out big time.

Speak to the bank about fixtures and fittings and they may do a deal with you re the stamp duty..at the end of the day they just want their money back and if you are serious will work with you.