Help with buying repossessed house.

jbea

Last Friday there was an open day at a repossessed house, we really liked the house even though the inside completely needs ripping out and starting again, although this will be a lot of work we feel we're up to the challenge and have some funds to pay the professional's when it gets really scary.

The problem we face is we are up against property developers, they were clearly looking around and summing it up when we were there.

Our position is we have sold to first time buyers and we therefore have a chain of 1. We have already proceeded to sale our house with our solicitor as we are happy to move in with relatives to secure the sale of our house. We expect this to take 6 weeks.

On Monday I phoned the agency selling the repossessed house to make an offer but I felt she was trying to scare me out of putting in an offer.

I was told an offer had already been made near the asking price from a developer and that she was expecting another. And that these people were cash buyers and could complete within 2 weeks.

Se also said as we have a chain and require a mortgage then its unlikely we would be considered.

Me and the wife were a bit despondent after hearing this and didn't put in an offer, but after thinking overnight we decided there was nothing to lose and so on Tuesday we made an offer for the full asking price.

This time she didn't try to discourage us and took all our details and later emailed to say she had put our offer forward and would let us know what they say.

This was yesterday, and after 24 hours we haven't heard back.

Is she right in saying we dont stand a chance and we wont be considered because of our position?

monty-doggy

Not at all. As a repo property they have a legal duty to achieve the highest possible price.
This unfortunately means you can spend money on surveys and solicitors and at last minute someone can out bid you and you lose any monies paid.

G_M

All you can do is decide howmuch you want the property, and howmuch you are willing to spend.

Then make your offer, in writing (then it has to be considered).

Either it will be accepted or not.

If not, you can then choose to increase the offer and see what happens...

If it IS accepted, you must recognise someone else (developer or not) may later offer more and you may be outbid.

Repos are stressfull, and can be costly...

Take what the EA says with a pinch of salt except when they are formally accepting or rejecting your offer.

All the 'there's a lot of interest' / 'developers are cashbuyers' guff may/may not be true - but the EA job is to push the price up.

jbea

How long do you think it will be before we can expect to hear back from them to say if our offer has been accepted.

If it is accepted then I understand it will be advertised in the paper to encourage higher bids right up until completion.

G_M

Between 1 day and 1 month.

MysteryM

jbea wrote: »

How long do you think it will be before we can expect to hear back from them to say if our offer has been accepted.

If it is accepted then I understand it will be advertised in the paper to encourage higher bids right up until completion.

No its right up until exchange. We are going through buying a repossed at the moment and are pushing for an exchange within the next week or so. Its a pain but worth it.

poet123

Yes, you can go ahead, but I have to say helping our son buy a repo was one of the most stressful things we have ever done. And he was a live at home, no property to sell, mortgage in place, cash in bank, brother as his Solicitor buyer.

You will need nerves of steel and the understanding that until the very, very, last minute things can go pear shaped.

jbea

Assuming my offer is accepted, I would then proceed to instruct the solicitor to proceed.

I realise if I am outbid then I could lose the solicitor's fee's which I calculate to be approx £1000 if it goes all the way, but at the moment we feel its worth a risk as we really like the house and location. However we do have a limit and have said we'll stick to that.

My next question is assuming I am outbid, when should I increase my offer? Should I do it straight away or leave it as long as possible? Is there a strategy I should adopt?

Twiggy_34

We did this last year, but for a slightly more complicated property; a 3 storey building divided into 2 flats which had to be bought together. DP's parents wanted an investment property and we were still renting so this was potentially perfect. We were told it had to be a cash buy as there was a stipulation from the bank that the whole transaction had to be completed within 3 weeks of the accepted offer (a mortgage application probably couldn't be approved in time).

Lots of family members on both sides scrabbled around to help us raise the capital, with a view to us then getting a mortgage to purchase the 2 bed flat from DP's parents so they could then pay everyone back. We didn't have property developers to contend with but there was a lot of general interest, a lot had to drop out because they couldn't sort out finances quickly enough and the last hanger-on (thanks to the ad in the paper stating that an offer had been accepted pending further interest) meant we offered over the asking price in order to secure the property.

We also needed to do a lot to each property to make them habitable, but it paid off, with a lot of work since we completed last year, we've increased the value of each flat by 50% of what they were purchased for.

Fingers x'd you get good news soon

G_M

Last repo I offerred on I shopped around for a conveyancer who assured me they could move things rapidly to get me to Exchange asap.

I asked if she was confidant enough of this to do me a 'no purchase no fee' deal and she agreed.

I lost the property.

She lost her fee.

(not sure who I felt more sorry for - it was a nice house!)