Has anyone ever bought a property at auction

[FunSponge82]

Morning!

The thought of buying a property at auction scares me to death! It just seems such a risk and I'm not a risk taker!

There is an auction coming up with a potential but I just think, knowing our luck, we'd buy a house held together by sodding wallpaper

How do you get mortgage funds in place on an auction property?

If anyone has any advice, good or bad, it would be greatly appreciated.

How do you get mortgage funds in place on an auction property?
Auctions are usually aimed at cash buyers as often they are in the sort of condition where a lender wouldn't guarantee a mortgage or the vendors want a quick sale. Sometimes getting a mortgage may be possible if for example the house is being repossessed, as it isn't the condition of the house that's the problem in that case.
It is usually possible to go and see properties beforehand though. You contact the agent and they will show you round.

Yes, the lots are often for cash buyers as fulfilling the 4-week timetable would be very difficult for most lenders. Often the lots have "problems" - this might not be their condition but a dodgy legal status, disputed boundaries or some such.

If you do need a mortgage, there are often lenders at the auctions themselves (but easily searchable online I expect) who specialise in fast loans which they expect a buyer to redeem in a few weeks once they have their own finances in place. These lenders tend to charge a lot but, if it's a property you love, it might be worth it.

It is a risk buying something at auction but properties are usually worth something even if they are in bad order or need legal knots untied. It's all a question of judging how much a place is really worth and that will vary from buyer to buyer depending on what they want to do with it (live in it/flip it/rent it out etc).

Does seem risky to me. In order not to end up buying a load of expensive problems, you need to look v carefully at all the paperwork, AND get an expensive survey done, only maybe to be outbid on the day, or even find it was 'sold prior'.

If properties seem cheap, it's usually for a reason. Particularly remember someone on HUTH who bought a flat on impulse because it seemed very cheap, only to find that the lease was only 60 years or something, and it was going to cost a hefty whack to extend (always costs more under 80 years).

OTOH sometimes it's because the place is uniquely desirable for some reason, and they set a low guide price to get buyers in, confident that people will be outbidding each other like mad. Dh and I were once interested in a seaside property in a fantastic and 'rarely available' location. It needed modernising but seemed apparently sound - dh had had a really good look and he knew what to look for. Guide price was £300k and it went for over £500k. TBH I wasn't really surprised.

The best auction outcome I have seen occasionally (HUTH again) is when a couple have wanted a property, done all their investigations etc., only to have their offer turned down because the vendor thinks they'll get more at auction.
Only they don't, and the original couple get it for less than the offer that was turned down.

I buy at auction regularly. As other posters have said it is not for the risk adverse. I am fortunate enough not to require lending but At the auction itself there are lenders available to assist with sorting funds but obviously these are not 2.99% mortgages 😉

There are two distinct types of auction property. Problem ones; I.e unmortagable owing to property condition (derelict/ half renovated) or association (lease length for example) or repossessions where the condition is good but legally the receiver has to fund a market value on an open market. You can sometimes pick up good condition properties in this category.

Always have a solicitor read the auction pack for you before bidding as you exchange contracts on the day. This does mean you will incur costs to find the answer is a no. Surveys are a peace of mind thing but often report what you can see by eye. I rarely use a surveyor unless I need a specific engineering question answering.

Auctions are usually no good if you have a chain but great if you are ready to go as there is usually no messing about. You will need a great solicitor yourself though and do not skimp on paying for the service of one familiar with auction purchases.

Good luck!