Pro's & Cons of buying a repossessed house

supa_nan

I'm looking to buy a house. I have seen a house that I am very interested in and would like to put in an offer. But it's a repo :eek:

The house isn't particularly cheap so wouldn't suit an investor.

I understand that a repo property stays on the market till you exchange contracts, I'm just a bit jittery about the whole thing.

Do I stand to lose much ? Would it just be survey fees and solicitor fees if someone comes along with a higher bid, and I can't beat it ?

Should I go in at maybe £10k below the asking price (170K) or keep it close to £170 ??

I am renting my property out so ain't in a chain, and have a mortgage agreed in principal with Barclays.

I would welcome any comments or experiences, thanks.

G_M

Pros: you might get it cheap;

Cons: expense of mortgaage application fee/survey/solicitor fees being lost due to ongoing marketing till Exchange; stress for same reason; inability to test plumbing, heating etc (usually turned off/frained down); properties often stripped/vandalised by disgruntled repossessees;
limited access to information - the seller will know nothing about the property.

Advice: have a good conveyancer ready who'll work fast; try to negotiate no Completion/no fee; have your finance ready; don't faff about asking for guarantees/building regs/other paperwork; get to Exchange asap

greenface

supa_nan wrote: »

I understand that a repo property stays on the market till you exchange contracts, .

Thats how i will work in future sales . been stung before when selling/buying by people asking me to take it off the market without all their things in order to buy. Took months of mess and it cost me 10k extra in buying my house due to their incompetent brief and themselves. I will never promise anyone again due to them being able to back out before exchange

celyn90

We get a lot of enquiries about the whereabouts of the vendor; mainly from debt collection agencies; but they are easy to deal with (well, apart from one company that has been a pain). I also wrote to the DVLA as well when we moved in.

We knew it needed gutting so checking the heating wasn't an issue as one of the first things we did was replace the boiler. I would advise that you have a contingency fund for unexpected repairs; but I'd advise that with any house purchase. Ours hadn't been trashed it'd just been neglected.

It was under market value (not enough for a developer to want it though), but over the asking in the end as we were repeatedly gazumped, but we were prepared for it and would have walked away had it gone much higher. We hadn't intended to buy a repo - it just happened that the house we liked was one.

We were FTB moving out of rental, so have no comparision to how stressful the process would have been normally; I think I would have been more stressed negiotating over curtain poles with a normal vendor to be honest. We had to move quickly, but we still managed to be on holiday for two out of the four weeks (booked before we started the buying process!) and for it not to be a problem. The bank was amazing and dealt with the mortage app super-fast for us once we told them it was repo, which was great

mandragora_2

We bought ours as a repo, 25 years ago nearly, now. It was repo'd as we were negotiating on the purchase, so we'd had plenty of opportunity to look at it, and be lied to by the then owners, before the bank relieved them of it. Yes, it was manky when we moved in - it was always going to be, repo or straight purchase; yes we had blokes from all over the place knocking on the door looking for monies owed for about 18 months, but we got a good deal, worked hard to renovate it and ended up with a great family home for our kids to grow up in that we'd never have been able to afford otherwise. They've grown up and gone now, and we've just about finished the renovation!:rotfl:

I'm glad we did it, but at the time we didn't ever bid more than we could afford, and I was prepared to walk away once the bank had repo'd officially and started making noises about putting it back on the market. Play the long game, and always be honest with yourself about what you can afford, and why you want to buy THIS house. Hope you get as much joy from your new home as we've had out of ours.

supa_nan

Thanks for your replies :beer:

We did view the house the other day to be fair it's not wrecked at all, and really only needs cosmetic attention, a new kitchen when we have the funds. Any work can be done on a as and when basis. Unless we found out the central heating or something didn't work :eek:

Windows are double glazed, but we'de want to upgrade to new UPVC eventually.

I've got my budget, and may go in a few K's lower than the asking price with a view to paying the full asking price. I suppose at worse I'll lose the survey fee, and possibly the mortgage arrangement fee

Just the thought of a rollercoaster purchase daunts me

We've only bought once before and that was a right to buy, so it was fairly straight forward

mandragora_2

supa_nan wrote: »

Thanks for your replies :beer:
Any work can be done on a as and when basis. Unless we found out the central heating or something didn't work :eek:

In no particualr order, these are the things that didn't work when we moved in:

• electric (they'd been cut off)
• chimney/fireplace - OH lit a fire and the sitting room filled with smoke
• water - we turned it on; 15 minutes later the overflow pipe gushed water - a ballcock in the tank had gone, so they used to run the mains in the morning, fill the tank till it overflowed and then turn off the mains water
• water tank - we ran a bath at the end of the first, exhausting day. The water was orange.
• any of the doors. TheIR 3 dogs running feral had chewed them to pieces
• plaster on the walls below knee height - ditto
• the only source of heating and hot water was a stove in the kitchen. It leaked carbon monoxide and was a potential death trap. The man from the coal board put a scary tape around it
• roof leaked in a stream of water at the top of the stairs when it rained

So, if yours is just cosmetic stuff, brilliant! As I said, we'd known ours was going to be a tip, and just assumed nothing would work, however it went beyond what even I'd imagined! Keep a contingency fund just in case yours has any hidden horrors - if I was doing the same now, I'd work out what I thought everything would cost to do and then add half as much again to the money I'd set aside and add twice as long to the time I expected it to take:)

supa_nan

Thanks again for your replies and sharing your experiences. I've decided to offer £5k below asking price. I am prepared to offer the full asking price I suppose it's a waiting game now :think: