Selling - Open market or modern method of auction(MMoA)

BarelySentientAI

ReadySteadyPop said:

Worried_of_wakefield said:

Have researched on the internet so I understand the mechanics, but would like to hear from people who have experienced the MMoA.

Inherited property, detached bungalow, circa £300K aged mother in-laws house so quite 'tired' needing work at some stage.

My worry is the estate agents are pushing hard on MMoA, which they would as thier rewards are greater

Sounds like the EA`s are starting to struggle, how are general sales going in your area?

Buoyant, thanks for asking Crashy.

Mrnkar_2

RHemmings said:

Mrnkar_2 said:

Not sure whether to start a new thread or not regarding my previous queries. 
The house I am interested in is now listed on an online auction site and not as I previously thought with an EA.
I haven't much time as the auction runs from 15th - 16th May.
A bit of history. House has been empty for years as both owners were in a care home. I know one of them passed away and think possibility the other now has. 
The property is listed as a repossession and the seller is an Insurance company down as the mortgagee.
Having read the Legal pack it doesn't seem straightforward so I contacted my previous solicitor to ask if they could read it. 
They charge £450 + Vat to do it and said they would reduce that cost if I use them if I purchase the property. 
It seems very expensive given that I may not even bid on it if it is complicated.
I would be grateful for any advice. Thank you. 
PS The house needs a good deal of work having suffered a severe water leak, but I have wanted to purchase it for years and I know the complete history of the property.

Is this MMoA or traditional auction? Is there a very, perhaps very unrealistically, low guide price? If it's repossessed, I would guess that it would be sold by traditional auction. Make sure you read every word of the contract, as quite often there are additional charges in there, sometimes a long way down. If this is traditional auction, then perhaps a new thread would be best. As it would be neither MMoA or open market.

I agree with @BarelySentientAI that the £450 + VAT is about what I would expect for that work of going through the legal pack, and reducing the cost if you purchase through them sounds reasonable. 

It's an online auction. Similar charges to MMoA but slightly cheaper. Here's part of the listing.

Additional Fees

Buyer's Premium - £1300 inc VAT payable on exchange of contracts.

Administration Charge-1.98% inc VAT of the purchase price, subject to a minimum of £1980 inc VAT, payable on exchange of contracts.

Disbursements - Please see the legal pack for any disbursements listed that may become payable by the purchaser on completion.

eddddy

Mrnkar_2 said:

It's an online auction. Similar charges to MMoA but slightly cheaper. Here's part of the listing.

Additional Fees

Buyer's Premium - £1300 inc VAT payable on exchange of contracts.

Administration Charge-1.98% inc VAT of the purchase price, subject to a minimum of £1980 inc VAT, payable on exchange of contracts.

Disbursements - Please see the legal pack for any disbursements listed that may become payable by the purchaser on completion.

Those T&Cs look like they're from an unconditional auction with auctionhouse.co.uk

If so, that's absolutely not MMoA (MMoA is a conditional auction).

i.e. With an unconditional auction, you exchange contracts on the fall of the virtual gavel.  The property is "sold as seen" and if you then try to back out, you could suffer very large financial losses.


So...

• You need your solicitor to do all the legal checks you need before you bid.

• You need all your surveys done before you bid.

• You should really have all your finance (e.g. a firm mortgage offer) arranged before you bid.

(TBH, if you need a mortgage, you probably shouldn't be considering an unconditional auction - it's too difficult and/or risky.)

Mrnkar_2

eddddy said:

Mrnkar_2 said:

It's an online auction. Similar charges to MMoA but slightly cheaper. Here's part of the listing.

Additional Fees

Buyer's Premium - £1300 inc VAT payable on exchange of contracts.

Administration Charge-1.98% inc VAT of the purchase price, subject to a minimum of £1980 inc VAT, payable on exchange of contracts.

Disbursements - Please see the legal pack for any disbursements listed that may become payable by the purchaser on completion.

Those T&Cs look like they're from an unconditional auction with auctionhouse.co.uk

If so, that's absolutely not MMoA (MMoA is a conditional auction).

i.e. With an unconditional auction, you exchange contracts on the fall of the virtual gavel.  The property is "sold as seen" and if you then try to back out, you could suffer very large financial losses.


So...

• You need your solicitor to do all the legal checks you need before you bid.

• You need all your surveys done before you bid.

• You should really have all your finance (e.g. a firm mortgage offer) arranged before you bid.

(TBH, if you need a mortgage, you probably shouldn't be considering an unconditional auction - it's too difficult and/or risky.)

Didn't go for the house after getting the legal pack read. Too many special conditions including having to pay all the sellers fees etc and a problem regarding a conservatory. House sold. for more than I would have bid. Just hope they read the legal pack beforehand. I'm just hoping that someone has bought it to flip it and then I shall consider buying it off them.