Bought an house at auction and now regret it

Samfootball

Hi,

Okay, This is a very complicated issue and would please like some advice.
So I bought a house at auction which has been converted into three flats. This was stated in the website and legal documents too. There are currently two out of three flats with tenanants living inside. I wasn't aware that this would be a huge issue with getting a mortgage aa a first time buyer. It is almost impossible to get a residential mortgage on the property because of this and I have also realised a day after the auction that there are also no building regulations in place from the previous owner when they converted the house into three separate flats making a buy to let mortgage impossible to get. The only option is a bridging mortgage which I do not want to go ahead with. The lack of this building regulation certificate was not noted anywhere in the property information form (TA6) that was in the legal pack and the question of any conversions/changed said the seller was aware of is ticked as no when clearly they should have mentioned the lack of this regulation certificate on the legal documents. Can I get a my deposit back because of this issue as I am unable to get the funds for the deposit if the bridging loan.
I have already paid nearly two thirds of my deposit (10%) on the day of the auction and cancelled the rest of the deposit after realising this issue. I have just 28days from the auction date to complete the paperwork or else risk loosing my deposit.

Is there any way of making a complaint and getting my deposit back.

Many thanks in advance

I have been extremely stressed since finding this out and very very depressed on the thought of loosing such a large amount of deposit put forward already by myself.

Tahlullah

Have you spoken to a solicitor?

Samfootball

Yes, my solicitor that I provided details for on the auction day doesn't deal with with bridging loans and I do not have enough deposit to mortgage the property. Nearly all my like savings down the drain if I loose this deposit. Very sad ATM

Dean000000

Did you visit / inspect the property before buying?

Or at least - were you afforded the opportunity?

Samfootball

TBH i did not visit the property but even if I did I wouldn't have known any different, as a first time buyer and don't know much about the legal side. It's is in a liveable condition as tenants are in their atm. Yes this was my fault for not viewing before buying which is a massive regret from my end but without the building regulation certificate I risk losing my life saving. 'm very lost

[Deleted User]

Need to raise this specific question with your solicitor. Not ask about bridging loans. Ask them if you have any options due to information not being given on the form. But auction properties are often cheaper than traditionally purchased properties for a reason, they can be unmortgageable for some reason. You should really have come across this in your research and engaged some scepticism.

Auctions, I am afraid, are not really for first time buyers. There could be other problems with the properties that you don't as yet know about. You could have been saved from a money pit. The vendor is selling at auction for a reason.

If you don't have any other properties (don't have a place you have bought for yourself) a BTL mortgage would have been difficult anyway. I'm afraid lenders will be concerned about their security, and it looks like you just don't know as much as you could about BTL.

Sorry you are in this situation.

I realise it is a huge amount of money that you put a lot of effort into saving and its awful to be in a position where you could lose it all. But try to keep a perspective, you can start saving again. You obviously have a job, and your health. I know that is probably annoying to hear right now, but I'm afraid it is true. You can start again. Its a very hard lesson but you only need to learn it once.

anselld

The lack of BR certificate is not necessarily a problem if the conversion was some time ago. The risk of enforcement action is very small (or zero if sufficient time is elapsed). Many lenders would be satisfied with an indemnity insurance.

What really restricts your mortgage options is the fact that two thirds of the property remains subject to Lease.

You should speak to a mortgage broker with experience in this market before you kiss goodbye to your deposit. ( because there is no way you will recover it through a complaint). Your Solicitor won't help with this part. They dislike auction purchase at the best of times. You need a specialist mortgage broker.

Tiglet2

A lot of auction properties have issues which is why cash buyers are often preferred. It is important to read all of the information and legal documents provided and if you do not understand them, to see a solicitor and pay them to go through the legal documents and to report their findings to you. You are a first time buyer with little legal knowledge and you need a mortgage. An auction property probably shouldn't have been considered. I don't think you will be able to get out of this without losing your deposit. Part of the attraction to auction properties is that you exchange immediately and complete a mere 28 days later, which is why you need to be fully informed before you bid.

davidmcn

Tahlullah wrote: »

Have you spoken to a solicitor?

Samfootball wrote: »

Yes, my solicitor that I provided details for on the auction day doesn't deal with with bridging loans

Yes, but have they looked at the auction contract and advised you on any options you have?

We haven't seen the terms and conditions (if you tell us which auctioneer it is we can try checking for you) but it may be that the property information form isn't contractually relevant - and in any event, proving whether somebody was aware of something can be tricky.

Be aware that you may be liable for the seller's whole losses if you pull out, not just the deposit you've paid (e.g. they might not achieve the same price if they resell).

Hasbeen

Samfootball wrote: »

TBH i did not visit the property but even if I did I wouldn't have known any different, as a first time buyer and don't know much about the legal side. It's is in a liveable condition as tenants are in their atm. Yes this was my fault for not viewing before buying which is a massive regret from my end but without the building regulation certificate I risk losing my life saving. 'm very lost

Sorry, you state you put your life savings at risk but did not even look at what you where buying? I symphasise.

What does the auction sites policy state regards cancelling refunds, and charges?

Can you not ask them to put property back on site?

They must get this all the time, talk to them.

G_M

I'm afraid with auctions the rule is buyer beware.You have to do your due diligence before you bid.

that means
* making sure you have the cash, or access to the cash (ie a firm mortgage offer)
* making sure the legal side is acceptable to you ie your solicitor has checked it all)
* making sure the condition is acceptable to you (ie a survey done)
etc

Once the hammer drops, you are legally committed, and can be sued if you fail to Complete.

Many (most?) auction properties have some kind of problem (structural, legal, condition, sitting tenants etc) that make them hard to sell - that's why they are put into auctions!

by the way- the tenants. Are they AST tenants or do they have Protected Tenancies? Did yo check befoe bidding.......?


I suspect this is an expensive learning experience.