Buying A repossession Property

Ctony

Hi all I only come accross this forum a couple of days ago and have found in extremely helpful and interesting...................I though I was always the only one stuggeling to get on the property ladder

I have been given a AIP/DIP with BM solutions, and inteed to submit a formal mortgage application as soon as our offer has been accepted. We are looking to borrow more then the value of the house to pay of existing debt and to help towards doing the property up.

Anyway the property I have offered on in a repossession house, our offer has been sitting on the table for days and we have not heard anything back, I understand that even if our offer is accepted we still are not guranteed the property until we have signed contracts, and anyone can gazzump us at any time.....we I'm a little worries about, I dont really want to pay for valuation fees and survey etc is we get out bid at the last minute, the EA has tried to reasure us by saying its unlikely the vendor will accept any other offers once the paper work has started as it means going back to square one again.

So my question is are these houses worth all the worry? Is there anyone out there currently going through this? Or has anybody got any advice for me?

Thanks in Advance

Chollita

I can't offer any advice on this issue, but bear in mind that you are NOT 'paying off' your existing debt, merely moving it ... also is it not risky to borrow more than the house is worth?

Ctony

Chollita wrote: »

I can't offer any advice on this issue, but bear in mind that you are NOT 'paying off' your existing debt, merely moving it ... also is it not risky to borrow more than the house is worth?

HI I know what you mean, I just moving the CC debt onto my mortgage, I would also be concerned if the amount was quite high, but Its only a couple of thousand. When speaking to the estate agent the properties in the area are going for 10 to 15 thousand pound more then this one i'm interested in, thats due to this needing a bit of work, nothing major is wrong just cosmetic etc, so I'm looking to make a little profit on this property. Hopefully

bargainbarmy

Ctony wrote: »

Hi all I only come accross this forum a couple of days ago and have found in extremely helpful and interesting...................I though I was always the only one stuggeling to get on the property ladder

I have been given a AIP/DIP with BM solutions, and inteed to submit a formal mortgage application as soon as our offer has been accepted. We are looking to borrow more then the value of the house to pay of existing debt and to help towards doing the property up.

Anyway the property I have offered on in a repossession house, our offer has been sitting on the table for days and we have not heard anything back, I understand that even if our offer is accepted we still are not guranteed the property until we have signed contracts, and anyone can gazzump us at any time.....we I'm a little worries about, I dont really want to pay for valuation fees and survey etc is we get out bid at the last minute, the EA has tried to reasure us by saying its unlikely the vendor will accept any other offers once the paper work has started as it means going back to square one again.

So my question is are these houses worth all the worry? Is there anyone out there currently going through this? Or has anybody got any advice for me?

Thanks in Advance

We had a nightmare earlier this year buying a flat that had been repossessed. It all began last December when we had our offer accepted. It was a fully cah offer of £124,500. the EA told us the same story as you that it would be probably ours as the lender would not want to go back to square 1. How wrong he was. We were given 16 days to exchange which was tight to get all searches and legals done but we got to about day 9 and then somebody put in a higher offer than ours. It went o abidding war between us and we eventually pulled out at £128,500. We thought that would be the last we'd hear about it and we went away very miffed. 5 months later in April of this year we got a phone call from the EA to see if we were still interested in it as the people who had outbid us still hadn't excahnged 5 months later!!! We were a bit dubious to say the least but we put in a lower offer of £121,250. The lender accepted it and again we had to go through the 16 day exchange procedure. About half way through this the other bidder who had taken 5 months to exchange (or not) made a formal complaint to the EA about the way they had dealt with the sale. The lender was therefore reconsidering their original offer of £130,000 and it looked like we may lose the property again. A few days passed and the EA said it was ok the lender still wanted to go with us as we were cash. We got to day 16 and our solicitor was ready to exchange. He rang the lenders solicitor and was told that their client had told them not to exchange and would not sell the property to us but would not give a reason why. We had had enough by this stage and were ready to go the ombudsman. I was told we didn't have case as nothing is binding until contracts are exchanged. Unbelievably 2 days late my solicitor rings me to say that the other side wanted to exchange!!!. We didthis straight away and a date was set for completion. things worked out in the end but it was a LOT of hassle and potentially could have cost us alot in legal fees if we had not got the property. Be prepared for this as it could easily happen to you.

lynnexxxo

Hi there

I may be wrong here but if the house has been repossessed and the bank now own it then they have a responsiblity to get the best price for it.

I think they have to advertise your offer in the local paper etc asking if anyone wants to better your offer. So if your offer is low chances are someone else might offer a bit more.

bargainbarmy

lynnexxxo wrote: »

Hi there

I may be wrong here but if the house has been repossessed and the bank now own it then they have a responsiblity to get the best price for it.

I think they have to advertise your offer in the local paper etc asking if anyone wants to better your offer. So if your offer is low chances are someone else might offer a bit more.

They didn't put an advert in paper first time we were buying property at £124,500 but second time they did at £121,250. It was funny even with advert second time around nobody put a higher bid in but they did first time when there was no advert in paper.

Ctony

Hi both thanks for your replys, As i undertsnad it once the bank/vendor have accepted an offer then but a public notice in the paper for one week advitising that they are still accepting higher offers, after this you have around 28 days to exchange contracts, but up in till you do anyone can outbid you, so its best to sign as soon as possible.

All the waiting......and it may be a lot longer wait yet!

Conrad

The ststem is designed to ensure the poor old defaulting borrowers obtain a fair outcome.

Imagine you had been repossessed, all you would want would be the very best price such that you would come away with either as little negative equity as possible or hopefuly some equity in your own pocket.

Lenders would be severly critiscised where they to sell for anything less than the maximum achievable.

Repossession numbers are rising due to sub prime borrwers having to pay much higher rates so I hope prices will fall as a result. Furthermore ALL subprime lenders have tightened criteria meaning a lot of sub prime borrowers now either cant enter the market or they cant get as a large a mortgage. With such a huge reduction of cash available the marekt must surely slow now.