Most of us buy our home through a process known as private treaty. This means that, in England and Wales at least, we search a specific area for a suitable home and once we’ve found the place of our dreams we make an offer to buy via the selling agent.
An alternative way to buy is the public auction. Buying at auction can be fun but you need to know what you are doing if you aren't to make some very costly mistakes. First of all, it's worth understanding how buying at auction differs from buying by way of private treaty.
In simple terms, if you bid for a property at auction you should know the following;
For these reasons buying at auction is normally the domain of the more experienced cash buyer; but not exclusively. It's not unusual for property that forms part of a deceased estate or property being sold by a mortgagee in possession (repossessed property) to be sold at auction.
If you decide to bid at auction there are some lenders that are happy to work with you. This might even include offering a bridging loan (a short term loan which will be repaid by a longer term mortgage a few weeks or months after you have completed on the purchase). The availability of bridging loans will depend largely on how large a deposit you have and how appealing a credit risk you are to the lender. It’s sometimes necessary to arrange a bridging loan when you still have another property to sell.
In order to have the best chance of successfully buying a property at auction there are some things you can do.
They are;
Auctions are still a great place to secure a bargain, but beware. They are full of professionals and if you are new to the game, it can be a scary place to buy the most expensive asset you may ever own.
For more information contact us or speak to a mortgage adviser on 01628 507477.
Nationwide ease their ‘Helping Hand’ mortgage designed to help first-time buyers get onto the property ladder by allowing them to borrow up to six times their income.
6 days ago
Keeping the kids entertained over the six-week summer holidays isn’t always easy, especially with the cost-of-living making it even more difficult. Below is a list of fun, inexpensive ideas to do over the break
The Financial Conduct Authority (FCA) has published a discussion paper about the future of the mortgage market in a bid to improve access for first -time buyers, self-employed, and those borrowing in retirement.
Ever wondered where the most reasonably-priced towns for families to buy are? Property company, Zoopla has identified the top 10 towns for families to live in the UK by looking at the most affordable towns, and how many people are looking in that area.
27 days ago
There was a 32% increase last year in 100% loan-to-value (LTV) mortgages which are mortgages that require zero deposit. According to a recent report by chartered accountants and business advisers, Lubbock Fine, the reason behind this is buyers simply struggling to save enough for a deposit.
28 days ago
Many people are quite private when it comes to what is in their bank account. In this short blog, we look into what Brits have saved by age group.
Research from buy-to-let lender, Landbay, shows that UK landlords are looking at raising rents ahead of the Renters' Rights Bill which is due to come into force this year.
Data shows landlords could miss out on green mortgages due to expired energy performance certificates.