GOTO auction purplebricks

bear.1973

Hi, once you list a property on an auction site, are u able to withdraw it without penalty. Is there a cooling off period to avoid any charges? 

I enquired with an estate agent 4 weeks ago about a property I’d seen on the open market. Thy advised was no point booking viewing as it going to auction soon. 

I’ve since decided to ring back as it’s still on open market, the agent gave same response so I pushed on it, the agent sed thy weren’t sure wen die to go to auction and booked viewing this week. However, I received a call same day saying because I’ve enquired while it’s going to auction then I’d be bound to  buy through auction? I’ve since checked the action site and it’s been added today! Even thou the seller rang and told them he had an interested buyer (I happened to know the seller and so made direct
contact) and not to list it until I’d viewed and had chance to make offer. 

I’ve researched lots on this and it seems the seller can withdraw from auction, but I can’t see anything about penalties or if there’s a cooling off period, or if we could call out the agent for acting against the sellers wishes. I understand the agent gets a lot more fee commission selling this way and feel thy e pushed the auction advert throu due to interested open market buyer. Any help appreciated on this one as I’m viewing tomorrow! Thanks 

propertyrental

What kind of auction?

Have you read the auction terms?

And did you not have an earlier thread on this....?

eddddy

GOTO do a few "unconditional auctions", but mostly they do "conditional auctions" - which are also called The Modern Method of Auction.


So assuming it's a Conditional Auction / Modern Method of Auction, and based on what you've said, it's likely that this is the situation:

• The auctioneer has sole selling rights

• If you make an offer through the auctioneers now - by default, it would be on Modern Method of Auction terms.

• That means you have to pay a reservation fee of 3.6% (minimum of £6,600) on top of your offer price (plus £375 for the legal pack)

• If your offer is accepted but you later don't go ahead with the purchase, you probably won't get the reservation fee back

• If, say, you approach the seller direct and buy it - and you don't pay the 3.6% (min £6,600) - the seller has to pay the 3.6% (min £6,600) to the auctioneer on exchange of contracts, plus a withdrawal fee of £420.

So the best option for you would probably be to approach the seller direct, persuade them to accept your offer direct - then the seller owes all the fees when you exchange contracts (but probably pays them on completion).

But the auctioneer probably won't like that option - so they'll probably try to persuade the seller not to do it.



(If the property doesn't sell at auction, you might be able to negotiate different terms with the auctioneer. But it's unlikely that you can do that before the auction is finished.)

RHemmings

GOTO Auctions have, in my opinion, terrible Terms and Conditions. Some of which would be way, way, unenforceable. I've also communicated with them, and again, my personal opinion is that, they are terrible. 

OP, you're thinking of buying by another method. And, you can probably get in touch with the vendor. But, I not too confidently predict that extricating the property from GOTO Auctions will be problematic. Unless there is a cooling off period. 

bear.1973

eddddy said:

GOTO do a few "unconditional auctions", but mostly they do "conditional auctions" - which are also called The Modern Method of Auction.


So assuming it's a Conditional Auction / Modern Method of Auction, and based on what you've said, it's likely that this is the situation:

• The auctioneer has sole selling rights

• If you make an offer through the auctioneers now - by default, it would be on Modern Method of Auction terms.

• That means you have to pay a reservation fee of 3.6% (minimum of £6,600) on top of your offer price (plus £375 for the legal pack)

• If your offer is accepted but you later don't go ahead with the purchase, you probably won't get the reservation fee back

• If, say, you approach the seller direct and buy it - and you don't pay the 3.6% (min £6,600) - the seller has to pay the 3.6% (min £6,600) to the auctioneer on exchange of contracts, plus a withdrawal fee of £420.

So the best option for you would probably be to approach the seller direct, persuade them to accept your offer direct - then the seller owes all the fees when you exchange contracts (but probably pays them on completion).

But the auctioneer probably won't like that option - so they'll probably try to persuade the seller not to do it.



(If the property doesn't sell at auction, you might be able to negotiate different terms with the auctioneer. But it's unlikely that you can do that before the auction is finished.)

Thanks for reply, really helpful 👍 I don’t suppose you are aware of any cooling off timeframes, say if the property has just been posted, would there be t&c’s for the seller that inc cooling off period, which would allow withdraw from auction? 

Also, could I point to seeing the property on open market other than auction site? 

eddddy

bear.1973 said:

Thanks for reply, really helpful 👍 I don’t suppose you are aware of any cooling off timeframes, say if the property has just been posted, would there be t&c’s for the seller that inc cooling off period, which would allow withdraw from auction? 

"The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 say that in most cases, you can cancel within 14 days. If you agree the services will start within this time, you may be charged for what you’ve used."

But if the auctioneers say they have introduced a buyer (e.g. you) within those 14 days, they might argue that they have completed the contract - so the full fee is payable.


(As a comparison:  If I enter into a contract with somebody to deep-clean my house, and they come tomorrow and do all the deep-cleaning, they've completed the contract. I can't wait 14 days then cancel the contract and refuse to pay.)

bear.1973 said:

Also, could I point to seeing the property on open market other than auction site? 

Probably not - because GOTO's t&cs for sellers say:



(The buyer's premium means the 3.6%, min £6.6k)

And I guess you found the property through the Estate Agent stated in the 'Authority to Auction'.



And also, if the seller cancels and/or you bypass the auction, it wouldn't be you 'fighting' the auctioneer over the 3.6% / £6.6k fee - it would be the seller. Is the seller the type of person who would be up for a 'fight' with an auctioneer? 

Or would they give in and assume that if they accept your offer, they'll have to pay the fee?