What do I need to have in place before an auction?

jonathanh1989

bris wrote: »

What's the house really worth and do you really have a chance at 60k. Guide prices are useless with auction properties, often they are just the figure required to satisfy the debt on the property.


You need a survey to make sure it's mortgagable and to give you a better valuation, if the property is in decent condition then the guide price can be well out.


If you don't have a mortgage in place then 28 days is going to be very hard to achieve, then the penalties start to kick in, and they are not cheap.

I've been to a couple of auctions in the same town before where most properties went for around there guide price. I'd have thought it was worth 60-65k. I imagine it's being sold off quickly at auction via the council.

I'm deffinetly going to enquire at the bank again as I don't believe the advice they gave me before was really applicable in an auction situation. I will see if they can put in a mortage application and do a full home buyers survey at my expense.

jonathanh1989

lincroft1710 wrote: »

As it's ex-council, are there forthcoming expensive building works planned by the council, which the owner of the maisonette will be forced to contribute?

Is there a way I could find that out? Would a survey reveal it?
It's a masionette on a street of other masionettes and houses. The bottom floor looks well kept. The buildings double glazed, the roof appears fine, I can't see what building work would be neccasary?

G_M

Before you bid, you MUST be confdent

* the property is what you want
* the condition is acceptable. No point doing a survey AFTER you bid and finding problems you did not expect. too late
* the money is available. Either cash or a confirmed mortgage offer. No point bidding and finding out later you cannot get the money
* the Title is sound. You must check the legal pack. If not confident yourself, use a solicitor. No point finding out after you bid that the lease is 25 years, or the neighbours have a ROW across the garden, or the property has been condemned by Building Control, or, or, or

once you bid, you are commited so you must have everything confimed. That means spending money upfront, with no guarantee you will win the aucion.

Many auction properties have problems, often serious. That's why they are in auctions, so check everything.

Go to several auctions before the one you want, to see how they work. How quickly things happen.

Google 'property auctions' and read all the guides.

lincroft1710

jonathanh1989 wrote: »

Is there a way I could find that out? Would a survey reveal it?
It's a masionette on a street of other masionettes and houses. The bottom floor looks well kept. The buildings double glazed, the roof appears fine, I can't see what building work would be neccasary?

The only way you can find out is to ask the council. But this doesn't mean that if there is nothing currently planned, there won't be in 5 years time.

Although this seems to happen mainly in London Boroughs, it is surprising what they can decide to do in properties which seem OK.

We may all be wrong and the reason the maisonette is being auctioned is because the owner just wants a quick sale. But always remember the phrase "caveat emptor", it applies doubly, if not triply at aucions.

jonathanh1989

lincroft1710 wrote: »

The only way you can find out is to ask the council. But this doesn't mean that if there is nothing currently planned, there won't be in 5 years time.

Although this seems to happen mainly in London Boroughs, it is surprising what they can decide to do in properties which seem OK.

We may all be wrong and the reason the maisonette is being auctioned is because the owner just wants a quick sale. But always remember the phrase "caveat emptor", it applies doubly, if not triply at aucions.

You may but there's often wisdom in numbers and I'd rather take some advice than go in headstrong, that's why I'm here asking in the first place

I just hope there's enough time to get a mortage offer and a surveyor round before the auction.

Rambosmum

We were first time buyer buying at auction.

We got a survey, all was good. The guide price was £90k, we were prepared to go to £120k.

We had a mortgage in principle, a solicitor lined up etc etc.

We wrote to the vendor via the auctioneers explaining that we wanted the house and made an outright offer of £115k and asked them to not go to auction.

5 years later and we've never looked back. Yes we may have got it cheaper at auction but similarly due to some difficulties with one of the searches and the vendors solicitors shutting up shop for 2 weeks it took 3 months to exchange.

G_M

Rambosmum wrote: »

We were first time buyer buying at auction.

We got a survey, all was good. The guide price was £90k, we were prepared to go to £120k.

We had a mortgage in principle, a solicitor lined up etc etc.

We wrote to the vendor via the auctioneers explaining that we wanted the house and made an outright offer of £115k and asked them to not go to auction.

5 years later and we've never looked back. Yes we may have got it cheaper at auction but similarly due to some difficulties with one of the searches and the vendors solicitors shutting up shop for 2 weeks it took 3 months to exchange.

I'm glad, for you, this worked out.

However for the sake of others I repeat my advice to have the money confirmed.

A mortgage in principle is meaningless. All it says is that the lender is 'in principle' willing to lend £XK to you.

But it says nothing about whether they will lend against that property. So

* you get MIP
* you bid (up to the value of your MIP + savings)
* you win
* you make a formal mortgage application
* the lender Values the property
* the lender's surveyor describes the property as 'uninhabitable', or values it at less than you expected, or advises the lender not to lend against the property at all
* you fail to get the mortgage
* you lose your 10% deposit
* the seller re-enters the property at auction and it sells for les than you had bid
* the seller sues you for the difference in sale price (+ auction & legal fees etc)