I Want A One Bedroom Flat - Repossed

Mr_Vincent

How risky is buying a repossed flat?

I earn £20 000 a year and am looking for one for my first ever private home and kinda thought that buying a repossed one would be cheaper than buying a straight one bedroom flat.

Ain't made of money like most people naturally so I would need to take out a mortgage somewhere.

My questions are these...........
Which sites possibly specialise in repossesed property?
I am after one ideally north within the London M25 motorway

&

What are the pitfalls of a first time buyer like myself?
Am I better off going for a repossession or am I better off going the real deal?

I am not necessarily after a bargain.
I want to give myself no longer than 25years paying off any loans on a property at the rate of £400 a month.

I have not done my sums yet, but am in a situation where I could do with moving out within a month.
I am not tied to any fee charging landlords.

theGrinch

Not sure about a repossed flat, but a repossessed flat is possible; although there is no guarantee of a bargain and as you say, its not a bargain you are after so you should consider the whole market.

1. work out what you can afford
2. get a mortgage offer in principle
3. familiarise yourself with the house buying process i.e. read this site and others.
4. write down what and where you want to buy
5. register with local estate agents
6. read auction catalogues
7. drop leatlets in the areas that interest you. should cost about £100 for 1500 leaflets
8. tell as many people as possible that you are looking, friends, family, local shops....even post here what you are after.
9. browse the net and local papers
10. repeat steps 4 to 9 every week.

its really important you make people aware that you are a serious buyer.

pitfalls? you can reduce these with sound advice. repossessions often turn up at auction and of course you need to complete within 28 days, which is tough for most buyers let alone a 1st timer.

never be frightened to walk away from a deal if you dont feel right...dont feel bullied into anything.

dont get into the mindset that its only repossessions. consider anything that is in the right place, of the right size, right price etc.

ask questions

meanmachine_2

During the last crash you could get your hands on a repossessed flat, normally via an auction. But you needed (and still need) to put down a 10% deposit and to be able to complete in one month.

Today, most are sold via agents, and you'll be competing against investors and developers.

You're trying to purchase something which, going by your salary, is beyond your means in today's massively hyped market.

The best advice I can give you is save what you can, build up a sizeable deposit and wait for prices to meet you, not for you to try to overstretch to meet them.

Sput2001

There's no real reason that buying a repossessed property should be significantly riskier than buying a normal one. In some ways it makes things easier as you're a first time buyer and the property will be vacant, so there's no chain.

Our first house was a repossession and we got a bargain, although it needed some work doing to it as it hadn't been looked after all that well. The main downside we found was that getting information about the property was that much harder as the previous owner was obviously out of the loop, and the building society that repossessed it and were selling it on didn't really know about the finer details of the property. You'll need to get a good survey done (and possibly additional surveys of things like the plumbing, wiring, drainage etc.) and probably be prepared to wait a little longer for the solicitors to do their respective things. I'd say the chances of you finding one and being in there within a month are pretty slim.

You might need to check what's available in your area first for the sort of money you can borrow.

On a £20,000 salary most lenders will lend you £70,000 without too much argument, and some will go to £90,000. The repayments on those amounts will be more than £400 per month, though. Assuming an interest rate of 6%, £70,000 will cost you £451 a month, whereas £90,000 will cost close on £580 a month. Many lenders will offer discounted rates for the first year or two, making the repayments temporarily more affordable, but remember they'll go back up to the "normal" amount once the discounted period has expired.

There's a useful calculator here. Just don't get your mortgage from John Charcol as they're expensive! High street banks are usually best avoided, too. Ask around to see if anyone knows of a decent IFA who should be able to give you decent, impartial advice.

Hope this helps!

Mr_Vincent

One month was a hopeful time.
I hate solicitors and surveyors.
Regrettably, I happen to enjoy work which has flexi-time

£90 000 I suppose will not be enough to buy a one bedroom flat.

I am asking those who are into property mags as general hobbies, how much am I expecting to pay for a one bedroom flat outside of central London but within the M25?

Yep, I am not after a bargain and it's Nick's experience that I like hearing for reminding me where I should or should not stand.
I'd hate to get a bargain if I found myself having to do a lot of renovating or was unable to contact the last owner for history advice.
I am no DIY'er.

If necessary, I may have to stay where I am - as a non rent paying resident with less freedom to express myself as I choose.

meanmachine_2

£90K within the M25 Yep, you're talking a skip my friend.

Best save up for a deposit and forget about buying for a few years.

In the meantime there are online auctioneers you can check out, just to give you an idea of how they work. And it wouldn't hurt popping along to the odd one in person. But don't get caught up in the "moment" and start bidding!

theGrinch

£90k in the north london area will be tough.
mostly limited to small 1 bedders in high rise.

you have 3 options if you want to get on property ladder at the moment. you will need to do the sums to see viability.

1. pool resources with someone else and buy
2. buy a 2 bed and let a room,
3. rent in london, and buy an investment property in a cheaper area.

lady123_2

you could try shared ownership as an option and try and purchase more shares in the property as your salary might go up