FTB, good finances, buy at auction ?

craggier

Hello everyone,

My question is:

I'm a first time buyer, working and happily saving a deposit and with no debt.

When I get to having say a 10% deposit, what are the chances a lender would give me a mortgage on a property in an auction ?

Cheers,

Craggier

Gary123456790

You have no idea until the result of the survey comes back whether you would get a mortgage on a property. For example if the kitchen or bathroom had been taken out then it would not usually be considered habitable and therefore not mortgageable. It could have big cracks etc... after all, why is the property being auctioned in the first place?

With only a 10% deposit if you have a small issue with previous credit this could also mean the mortgage is declined.

With auctions you usually have 28 days to complete or face huge penalties. It is therefore more suited to people who have cash or big deposits.

I'd be wary of buying at auction with anything other than cash myself.

You also need to ensure you have money for buying fees, etc.

Gary.

kingstreet

You would have to apply for a mortgage and pay to have a valuation done before the auction. You would have to contract a solicitor to visit the auctioneer's office to scrutinise the legal pack before the day of the auction.

That means you could have spent hundreds on fees and be outbid at the auction by someone not as dependent on a mortgage as you are.

This is probably not the right route for a first purchase. It will be in an auction for a reason. Make sure you know what that reason is, before you bid.