Once the hammer falls, the property is sold and the contract becomes legally binding. You will have to pay your auction fees, 10% deposit and your solicitor will complete the purchase for the date set in the contract, normally 28 to 56 days after auction. Just be careful as to what other fees may be payable at the auction.
Buying a house at auction
Risks can be huge when buying property at auction and it may be that property couldn’t sell on the open market. Reasons can include:
- The property was repossessed by the lender
- The property isn’t able to be mortgaged due to a structural or legal issue
- The sellers don’t have enough evidence to prove title ownership of unregistered property
- The property is in an area affected by local developments which reduce the value of the property.
If the property is leasehold, a common mistake when buying at auction is to not find out the lease term first. Many leasehold properties with short leases (under 80 years) may not be able to be mortgaged.
What is an auction legal pack?
The auction legal pack normally becomes available to review 2 weeks before the auction. To avoid any nasty surprises, we can review the legal pack and let you know what information you do not have and flag any issues in the documentation provided. The pack will normally contain the following:
- Contract of sale
- Title plan (boundary of the property)
- Official copy of the register of title (title deeds)
- Conveyancing searches (Local authority, drainage and environmental)
- Property Information form, Fittings and contents form and if leasehold, Leasehold Information Form.
- If leasehold: Leasehold Information Pack (Management information pack)
Why choose Moore & Tibbits?
We are here to guide you through the process of buying a property at auction. We can thoroughly check the legal pack and prepare a pre-auction report so you are fully aware of any issues before committing to buy. Our team has extensive property knowledge, understand the timescales involved when buying at auction and are recommended by local auction companies as a trusted advisor. We will always keep you informed with direct contact to our property solicitors to ensure your transaction is carried out as smoothly and quickly as possible.
Thinking of buying at auction? Talk to us today on 01926 491181.