property auction

tip1

Hello, first time poster so I'm not sure if I'm in the right place or if I can ask this sort of thing....
I'm considering buying a property at auction. It's being auctioned by a new fangled online-only company, as in the auction is only online (as opposed to the normal Homes Under the Hammer roomfull with some online bidders). Their website claims they've been operating in Ireland for a few years, and just started auctioning properties in the UK.
The thing that's worrying me is that they ask for pre-authorised deposits from everyone who registers to bid - in my case I would have to authorise my credit/debit card for a deposit payment of £4,500 for bidder security. If you have the winning bid they take the £4,500, if you don't win the property the bidder security will be released on the card. I'm sure that's the modern way of doing things but I'm having nightmares about them running away with my £4,500. The usual kind of auction allows you to bid online, by phone or in the room simply by asking for proof of identity.
The new-fangled company's website looks ok, Google doesn't throw up any scam warnings, there are online newspaper reports about the company's auctions outside the UK (except I'm beginning to wonder if they're all faked), the London phone number is always answered and questions dealt with in a business like fashion - and so everything sounds hunky dory. It's just the pre-authorising of £4,500 that's scaring me.
I'm not sure if I can name the company on here so I won't but am I right in being concerned? I'm hoping you can tell me that's it's all above board.
Any help would be appreciated, thanks.

anselld

I am guessing Bid X1.

The deposit is a worry, yes. However, I would be more worried about what terms and conditions are being committed to if the bid is successful and the deposit is duly taken. The website seems silent on that.

In addition all the normal risks of auction purchase presumably apply, ie committed when the "hammer comes down", short time to complete, etc.

Are you a cash buyer?

Has this property got something special that makes it worth the risk over others?

tip1

Hi Anselld, thanks for the reply.
Yes, that's the auction company. I'm a cash buyer (that sounds flash but it's a really cheap property if it goes for anything near the guide price) and I'd be getting the legal pack looked at professionally so there shouldn't be any nasty surprises with the actual purchase, it's just the upfront deposit, or giving someone the permission to take a sum from my card, that's a worry.
Unless that process is fairly common practice and it's just me that's not come across it before......

I've chosen that particular property simply because of the geography, very convenient for me, its guide price and its potential.

davidmcn

Haven't heard of the upfront deposit before bidding elsewhere, but if you were the successful bidder anywhere else you'd then have to trust them with your card details anyway. It appear to me to be a legitimate business rather than a bunch of scammers.

tip1

You're right davidmcn, I wouldn't think twice about giving the card details to the ordinary auction people. I guess it's just that you do that after you've bought a property, in a room full of people (auctioneers, buyers, solicitors... who all think/know it's a perfectly normal process.
With this process, every single person interested in bidding, whether they bid or not, has handed over their card details, and it won't feel like there's safety in numbers cos it's just you, sat there clicking a mouse, wondering why nothing seems to be happening on screen, as some shark sprints away with all of those deposits. It's the fear of the unknown I guess.
I was hoping someone would be able to tell me they've bought through them, knew someone who had etc and it all went swimmingly well.

G_M

The T&Cs appear to be revealed at 'Step 3', once you have set up an acount and Registered to bid (but before selecting your property and paying the deposit).

However keeping the T&Cs hidden till late in the process is not exactly transparent or inspire confidence.

Personally I'd hesitate before handing cash to a brand new company with no track record in the UK, especially one introducing a brand new product (online auction).

I guess using a credit card would provide protection though, since if they went into immediate liquidation or vanished with all the deposits, you could claim back from the credit card company.

Some websites are claiming Bid X1 took over Andrews and Robertson, a well-established UK auction house. However the A&R website describes themselves as "a dynamic independently-owned business built on secure foundations: at the hub of the UK's auction market for 150 years." No mention of having been taken over........

tip1

thanks G_M, I'll give those pages further scouring tomorrow. I really appreciate your help, everyone, very kind of you.
Bestest,
Tip1

Tom99

G_M wrote: »

Some websites are claiming Bid X1 took over Andrews and Robertson, a well-established UK auction house. However the A&R website describes themselves as "a dynamic independently-owned business built on secure foundations: at the hub of the UK's auction market for 150 years." No mention of having been taken over........

[FONT=Verdana, sans-serif]This take over is listed as news on the A&R website and many senior A&R personal are now listed as senior personal on the Bid X1 website still with their A&R email addresses. [/FONT]
[FONT=Verdana, sans-serif]http://www.a-rpropertyauctions.co.uk/news/article/119/ BidX1, today announced that they have acquired leading UK property auctioneers Andrews and Robertson[/FONT]

eddddy

G_M wrote: »

I guess using a credit card would provide protection though, since if they went into immediate liquidation or vanished with all the deposits, you could claim back from the credit card company.

There might be less protection than you expect.

Typically, section 75 of the Consumer Credit Act would make the Credit Card company jointly liable in the circumstances you describe.
(See: https://www.moneysavingexpert.com/shopping/section75-protect-your-purchases)

But... the purchase of land (i.e. property) is specifically excluded from this protection.


There's another mechanism call 'Chargeback' which may help.
(See: https://www.moneysavingexpert.com/shopping/visa-mastercard-chargeback)
But that's much less robust than 'Section 75'.

tip1

Thank you Tom99 for that research, a great help. The info is backed up by Compainies House entries too, and just to double check.... because paranoia can do weird things to yer head..... I emailed one of their directors, one that had originally been with Andrews and Robertson. He mailed back and we then chatted on the phone, and he allayed my fears.
I feel a bit stupid now but much more confident about it all, and I would never have got to that point without all of you. Thank you for your help.

tip1