Sealed bids

toffee'n'tom

I have eventually sold my house!!! Less than I actually wanted but to a cash buyer and at the minimum price I'd set for myself. The sale is going through without any problems.

I have now found a house I'd like to buy. It's a total renovation project and will be a cash purchase. As it's a really popular area and places like this don't come up very often, I'm not the only one interested. It's now gone to sealed bids.

The sealed bids have to be in by this Friday, 8th June but the problem is I haven't yet exchanged contracts and part of the bidding process is to provide evidence of funds. My solicitors are now pushing to exchange this Friday or Monday at the latest and will write a letter to state that. But I believe that others interested in the property have the cash in the bank.

I also don't want to start bidding silly money just to get it. It was up for £100k and my offer was £118,950 (it was never going to go for 100k) but I believe the estate agents must have told someone my offer and they put in a further offer of 120k.

Two questions. In anyone's experience am I going to be discounted because of my position of not having exchanged contracts? And second - I know i must only bid what I think the property is like and what I can afford, but any suggestions on amounts?

Losing sleep!!!!!!!

Cheeky_Monkey

To be honest, I think you might as well forget this property. You don't really stand a realistic chance of getting it.

First of all, you haven't actually 'sold' your house at this point in time until, at the very least, you have exchanged and, as such, you're not in a good position to compete against cash buyers.

To be honest, even if you were able to exchange in time, if I was the seller, your solicitor's letter wouldn't encourage me to accept your bid over cash buyers because, however unlikely it might be, it is still possible for your buyer to pull out, despite losing their deposit.

How do the Estate Agents know what your bid is? The clue is in the title - 'sealed' bids. No-one should see your bid until bidding closes and all the envelopes are opened together, usually by the seller.

eddddy

toffeentom wrote: »

In anyone's experience am I going to be discounted because of my position of not having exchanged contracts?

The EA will probably just pass the offers onto the vendor. So it's up to the vendor - without knowing anything about the vendor, it's hard to second guess.

I would suggest that you include a clear, concise explanation of your circumstances - with an invitation for the vendor's solicitors to contact your solicitors to confirm the status of your sale.

But first of all, ask the EA lots of questions - about the vendor; who else is interested in the property; what price the EA expects it to go for; etc. It may help you to decide your strategy (but remember that the EA may not always be 100% honest!!!)

If you are a serious bidder, the EA will want to help you. Remember his/her motivation is to get a completed sale.

toffee'n'tom

thanks for the reply. The vendor is a very elderly gentleman who has recently driven himself to a nursing home as he couldn't continue to care for himself. I'm unaware of any family he has so I think I have as much information as I can get. The estate agents aren't local but they have been very helpful and, as you said, they will be passing all bids through to the solicitors who will make the decision. I don't know if that will be based on the highest bid, proceedability (if there's such a word) or both?

DVardysShadow

Cheeky_Monkey wrote: »

To be honest, I think you might as well forget this property. You don't really stand a realistic chance of getting it.

While I agree with the line of argument, if I were in the same position, I would punt with an offer, because you never know how thickly the agent is trowelling it on. And I think it is worth a bluff about the exchange, provided you are prepared to come clean fairly quickly if it has not happened.

Personally, if I were going to bluff, I would probably punt in at a lower price than the agent is indicating for other bidders. So if there is an embarrassing moment when the bid is accepted but the exchange has not happened, there is a little bit of embarrassment to poke back at the agent.

toffee'n'tom

The cash buyer is a local guy.

I thought someone might say forget it. Can't believe I'm going to miss this one - it's perfect. But if it's not meant to be ..........

It's sort of my own fault. I haven't pushed my sale through quickly because I've two teenagers taking exams that don't finish until the end of June so I didn't want to move before then.

And then this house came up for sale - oh well - I'll give it a go though

toffee'n'tom

OK - i've just had another thought. If I could gather together evidence that I have say £120k cash using bank statements from my mum and ex for example - would that be sufficient or better than the imminent sale of my property. I may be able to do that,

I understand that sealed bids are not legally binding so if my sale fell through for any reason I could always pull out of the purchase?

Any speedy thoughts would be really welcome as I'd only have today/tomorrow to gather the paperwork together.

And thanks for the replies so far - I appreciate the honesty.

Cheeky_Monkey

I think you'll find that the money has to be in your account not other people's but I could be wrong!

Sorry to sound so negative but it's just how I see it.

You didn't answer how the EA knows what your bid is?

InMyDreams

toffeentom wrote: »

I understand that sealed bids are not legally binding so if my sale fell through for any reason I could always pull out of the purchase?

And the seller knows that too. Which is why offers from genuine cash buyers will always be more attractive.

I think your best bet is to push for exchange on your own house. That will definitely put you in a better position than if you haven't exchanged. It depends how much of a hurry the seller is in. They may well be happy to wait until Monday (to see if you exchange) before deciding which offer to accept. And as for how much higher your offer would have to be over any cash buyer offer, that also depends on the sellers circumstances which you are unlikely to be fully privy to.

JQ.

Copies of bank statements from other people would actually put me off you, as I'd think you were pretty naiave to think such things would mean anything.

I could get a bank statement for £1m tomorrow from a family member. It most definately does not mean they'll lend me £1m and I cetainly could never repay £1m so it'd be totally meaningless.

You should bid what you want to bid, get the letter from the solicitor (perhaps include a draft copy of your contract) and put in a personal letter to the vendor about what buying the house means to you. If it's a about creating a family home for you to bring up your family in and spend the reast of you life in, state that - some people would rather sell to someone who will care for their former home than to a developer who is just in it for a fast buck.