There are a few problems that can arise when purchasing property at auctions. However, those who do their homework and approach the auction wisely will find that solutions are not too difficult to come by.
Many people use auctions to find property at below the normal market value. Buyers need to be aware that if bidding is fierce, property could go for more than the market guide price. It’s important to research the value of the property and stick to a budget when bidding to avoid paying too much.
The completion of the sale is usually required within 28 days. Prospective purchases may have an agreement with a lender that they are eligible for a mortgage to complete a purchase, but they could find that the funds are not available before the completion deadline. While waiting for mortgage funds to arrive, purchasers can find a specialist lender who will provide a short-term bridging loan to complete the housebuying process.
Another difficulty that could arise is appointing a solicitor who does not have the specialist knowledge to deal with auction purchases. A specialist solicitor will be able to monitor everything needed to complete the purchase on time. This will include valuations, plus all the legal requirements and forms necessary. If a purchase is not completed on time, the purchaser will still have to pay valuation and legal fees, so it’s vital to get this sorted.
Buying a property at an auction can be an effective solution as long as buyers know about potential problems and how to avoid them.