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Original poster

We're in a bidding war - any advice?

20 replies

pussollini · 06/03/2013 09:55

We are bidding on a property that is perfect for us and doesn't come up very often. We are 100% cash buyers and ready to go. The flat has been repossessed and is in the hands of a finance company. We saw it and offered asking price. We were aware there were other bids on the table but that no-one had offered asking price. We were then told the other party had raised its bid, so we raised ours from 125 to 127. We then heard they had raised theirs again. Of course they won't tell us what this new bid is, so we raised ours to 130 (our top bid is 135). They haven't contacted us again.

What's the deal? Are they allowed to come back to us, or would that be tantamount to telling us we needed to up it a bit more to beat them? I'm a bit confused.

OP posts:

Original poster

pussollini · 06/03/2013 10:12

Any estate agents out there?

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HappyJoyful · 06/03/2013 10:17

Umm, I'm no expert but sure I've read before you should be in an 'un round' figure - eg: £131,547...

I also thought there was a cut off date when they took all bids - if you don't want to loose out I would be on the phone to them immediately asking this.

If your max offer is £135k as I say, I'd just go for it and say £134,555 or something. I think the Finance Company may tell you the highest bid at moment as they have obligations to secure the highest price so if you were going to beat it they'd tell you surely ??

Original poster

pussollini · 06/03/2013 10:23

Thanks Happy, hmm, I see the advantage of an unround figure, harder for the other party to hit, right? Feeling a bit green

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HappyJoyful · 06/03/2013 10:26

I think that is what the mentality is!
You have to call them though - no point pondering, get on phone and ask outright when/what the date/cut off is for the final bid.

jeee · 06/03/2013 10:27

Don't get obsessed with this property. At the end of the day it's just a flat. Offer the maximum you're prepared to pay, and then leave it.

If you don't get this flat, there will be others, honestly.

guineapiglet · 06/03/2013 10:27

Hold your nerve! It all sounds a bit suspcious to me, with the Finance Co obviously trying to maximise their profits - you are in a brilliant position and they will of course push you as far as they think they can. Do you know how long the flat has been on the market for? Do you know anything about the finance co and if they are reputable and to be trusted?

You can either bluff it out, or go in gung ho with your top and final bid, ( personally I would be cautious, do you really think it worth that much? How long ago is it since they contacted you? Hope it works out for you, but there are some very unscrupulous folk out there, so go carefully! :)

HormonalHousewife · 06/03/2013 10:31

I'm not sure the odd figure is a suggested approach, isnt that more of an ebay thing

I would tread warily. They finance company know you are interested and will not 'forget about you ' just yet. They want the best price of course !

Usually they will operated a sealed bids approach, where all interested parties put in a sealed letter with their best and final offer.

lalalonglegs · 06/03/2013 10:48

One common route with repos is for a bid to be offered and the mortgagees then have to advertise it along the lines of "We have an offer of #127k with regard to Flat x, xxx building, Such and such a street. Interested parties have until xx date to submit further offers."

This is meant to make the process more transparent but, of course, means that you are open to being gazumped. Like others have said, find out the closing date and put in a final offer then.

Original poster

pussollini · 06/03/2013 10:54

Lala, it started off like that, on RM, 'we have a bid for x', but no deadline set for receiving bids.

I just spoke to the agent who is 'in a meeting' but will call me back shortly with an update. Apparently we are not out of the running.

We've looked quite carefully at the value (opportunity to buy into the freehold and increase value) so we wouldn't bid above 135.

I know other flats will be along, but we are in a bit of a hurry and this is chain free and just round the corner from where we live.

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FireOverBabylon · 06/03/2013 11:02

If it's a repossession, they have to leave the house on the market for, I think, 28 days, after they receive an offer, to see if anyone betters it. Ask the estate agents when it's coming off the market, and put in your best bid just before then - work in the same way as with eBay.

Original poster

pussollini · 06/03/2013 11:38

Hm, so now I look on RM and I see they have published the other, higher, bid. The agent is still not calling me back - although he did say we are still in on the bidding. The other bid is 32,500 but I know they are buying with a mortgage. I'm thinking of offering the same and hoping our cash status will swing it out way.

But now I'm concerned about this deadline aspect.

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PigletJohn · 06/03/2013 11:51

1 There will always be another

2 The agent is not working for you, it is his job to get the highest possible price

3 The agent knows that if you hear the right words, you will offer more money.

HappyJoyful · 06/03/2013 11:54

umm, hate to tell you, I don't think a cash status helps in this instance.. the company is obliged by the bank/mortgage company it's selling on behalf of to sell to highest price I think as it's repossession - hence guineapig if they do have higher offers, holding nerve etc doesn't apply - it will go to highest bidder, not relevant to how long been on market etc in case of repo.

Original poster

pussollini · 06/03/2013 15:06

Hm, I'm just not very good at this. Apparently according to the EA the finance company wants a cash buyer, but as Happyjoyful rightly says, they could just be saying that to keep us in. He has also said they may well need us to up our offer.

I know there will also be another (we found this on first day of looking) but it does have some big advantages, mainly that the freehold is up for grabs and an unofficial roof terrace that I think I can get made secure and so increase the value. All the bidders are looking for a BTL (as we are).

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HappyJoyful · 06/03/2013 15:35

I could be wrong, but I've just always been under impression they had to go for highest buyer, despite what other's say I of course it's estate agents job to secure highest price and they may not be bullshitting you.

Original poster

pussollini · 06/03/2013 16:01

Happy you are quite right. I meant the EA might just be telling us vendor is delighted we are cash buyers, when actually their sole remit is value, and it doesn't make much difference to them if we can complete in 10 days or six weeks. I expect that's why he said they may well ask us to up our offer. Er, that'll be to match the other buyer then...

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Petalpink · 06/03/2013 17:01

Offer best and final offer (the most you are willing to offer). Tell them the terms of the offer is that it expires at the end of the working day or 9 the next day. Reconfirm that you are chain free and cash buyers and then be willing to walk away...

wendybird77 · 06/03/2013 20:14

Don't rely on the EA to pass on your offer. We offered higher on a repo and lost it as the EA didn't pass on our offer - the deal was done in his eyes and his commission wasn't going to increase by much. Find out who the finance company is and contact them directly - we did this, but it was too late by then. The finance company was furious and took that EA off their list of approved agencies. It was a lovely house. However, we did find another one and are very happy. No regrets even though we pass by the 'lost' house daily.

Mintyy · 06/03/2013 20:18

The Estate Agents are obliged to tell you what the final date is. These bidding wars cannot go on indefinitely.

LadyKooKoo · 06/03/2013 21:43

There is no final date when it comes to repossessions, you can be outbid right up to the moment that you are due to exchange contracts. Our current property was a repossession and was advertised up to the date we exchanged contracts. We had completed within 28 days of putting in our offer purely because I didn't want anyone getting their foot in at the last moment.

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