Auction Property - in a big mess :cry:

frustrated_jayne

hello everyone,

we bought a property at auction.... we had seen the property before. but made the mistake of not getting survey done before going ahead. (am mad!!!) well, we never thot we would buy, we were just 50-50.... i mean it just happened and am in deep sh*t right now!!!!!!

I downloaded the legal pack on the 20th of Jan and read all the paper work and found it to be an "ok" purchase. I did see the property obv did not find any problem with it.

After the auction, after i signed the documents & pay the deposit, I gave papers to my solicitor, who said some papers were missing. So he asked the sellers solicitors to send the law society property forms etc.

When they sent the papers I was shocked to see the mention of possible subsidence and no insurance on the building. I checked the estate agent and download a copy of legal pack again and checked... those two documents were uploaded on the 29th of Jan. There was no mention of the legal pack being updated nor the property was advertised as having prev settlement/subsidence issue.

I got a survey done and the surveyor has told me there is settlement and the building tilts to one side. he said some cracks could be concealed within plaster or paperwork.

We have paid 10% deposit and I admit it has been a huge mistake.... but again I have a feeling they have concealed the fact that the house has a history of subsidence.

Please help me, I do not have much time!!!!!!

Please do not tell me or ask me always to get a survey done, I admit i have made a mistake and I cant the stress of people advising regd my mistake now! (if that makes sense!!!)

kingstreet

The legal pack should have been scrutinised by your solicitor prior to the auction, as well as a survey being carried out.

What help are you asking for?

samba

Settlement and subsidence are not the same thing.

Nobbie1967

I think this will be a case of 'buyer beware'. Check the T&Cs of the auction about the legal pack. Does it have any disclaimers about possibly being incomplete until a certain time before the auction? If the solicitor noticed the forms were missing then a court may well assume that had you had the legals checked before the auction then it would have been picked up.

Even without this, the surveyor noticed the subsidence, so I don't think you stand a chance of getting out of this as the condition was apparent had you undertaken reasonable due diligence, i.e. had a survey done prior to buying.

Bad luck

ognum

Frustrated Jayne
I am not sure what you are asking here maybe you can clarify.

Are you looking for a way out of the purchase, are you looking for compensation?

sadly we do not have the terms and conditions of the auction, we do not have a copy of the legal pack, we do not know the advice given to you by your solicitor, exactly when you employed them to read the legal pack nor do we have the surveyors report so there is a lot missing.

Are you getting a mortgage has it been granted?

I do read you were a first time buyer looking for a mortgage with the Nationwide 18 months ago so I think you are probably inexperienced. In my opinion your best bet may be to forfeit your deposit and walk away.

However there are to many gaps to really know.

eddddy

I guess your options include:

- buy the property and repair it

- buy the property and investigate options for redevelopment of the site (e.g. get planning consent to demolish and rebuild bigger and better.)

- ask the seller (via your solicitor) what compensation they would accept for cancelling the sale

- do nothing and wait for a damages claim from the seller (Not recommended - it could be much more than the 10% deposit).

- ask the auctioneers about putting it back in the next sale (you will have to pay selling fees, legal fees plus a loss/gain depending on what it sells for).


Edit to add...

Just to emphasise, if you fail to complete/walk away, your losses won't be limited to the 10% deposit.

G_M

No one can wave a magic wand and take you back in time to the auction date. If it were possible, of course we would then grab your hand and prevent you from bidding.

Properties usually go into aucions because they have problems. So, as you have pointed out, before biddig buyers should always

* be fully satisfied with the condition
* be fully satisfied with the legal provenance
* be fully financed and able to pay (no 'mortgage in principle')

As for advice, you have several options - all bad:

1) Walk away. Lose your 10% deposit and hope the seller does not also sue for further consequential losses. ie if the property later sells for less than you bid, he could claim the difference

2) Pay the full amount and Complete. Then either repair or re-sell.

3) Emigrate

frustrated_jayne

Thank you replying guys!

Thank you... yes I havent been diligent... yes i have made a mistake!!!! okay... there is no magic!

All I need to know ... Is there any way to get out of it ?
All I can say is, there was no insurance on the property when it was sold. The insurance was refused to the seller (as he mentioned he "thought" the floor had subsided way back in 1993 when he bought the property) He did not do any survey nor any repair then but just applied Latex screed on the floor.

Look guys, I can buy the property repair it! I can live in it.... I bought to live in it... it is in one of the fab areas, there is an outstanding state school in the area (one of the top 500) It is a very popular area & that is the reason we wanted to buy a place there.


The auction condition includes:
a) if owing to the default of the buyer completion does not take place on the completion date the buyer shall on autual completion pay in addition to the balanceof the purchase price :

a. The costs of the sellers soliciots in the sum of £100 plus VAT relating to the prepatation and serving of a notice to complete and

b> The interest payable by the seller and any additional costs incurred by the seller arising from any agreement for purchase entered into by the seller in reliance of this agreement and which the seller was unable to complete owing to the default of the buyer.

I think I have made a huge mistake of asking in this forum! May be I should accept it and just go ahead of it! Thank you for your time everyone. cheers

G_M

I think your options have been laid out.

If you have the money (ie don't need a mortgage), and since

I can live in it.... I bought to live in it... it is in one of the fab areas, there is an outstanding state school in the area (one of the top 500) It is a very popular area

the best option is to do that.

If you shop around a specialist broker, you might find insurance (though probably excluding damage from subsidence). Otherwise, well, insurance is optional - jusy be extra careful with candles & put in a burglar alarm!

DTDfanBoy

Well everyone has made it fairly clear exactly how you can 'get out of it' you just don't seem to appreciate the advice.

I hope for your sake that you're not relying on a mortgage for the purchase, things could get even messier if you are.

Cheeky_Monkey

frustrated_jayne wrote: »

All I need to know ... Is there any way to get out of it ?

I think I have made a huge mistake of asking in this forum! May be I should accept it and just go ahead of it! Thank you for your time everyone. cheers

You've already been told that you can 'get out of it' but you will lose your 10% deposit. You will also have to write off the auction house fee and your solicitor's bill.

I think we all know that asking on this forum wasn't the huge mistake!!