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Need to Buy or
Sell a Home!
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How To Buy Bargain Property At Auction
By Don Suter
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Do you want to invest in profitable property or simply buy a new
home at a bargain price? If so, you want to consider property
auctions.
Properties sold at auction are often owned by mortgage lenders
after repossessions, former council / housing association homes
or have being empty for some time after the owner passed away.
In each case, the owner has put the property on auction for a
quick sale and this can lead to some great deals on the market
value. |
Finding an auction
As auctions tend to cater for property professionals, rather
than the general public, advertising and awareness of auction
houses is limited.
A good place to start is looking through the telephone
directory, yellow pages or searching on Google or Yahoo.
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Another good tip is to keep an eye out for For Sale signs
outside homes. Where the board says 'for sale by auction', call
the telephone number provided. You will either get through to an
estate agent acting on behalf of the auction house, or you will
get through to the auction house directly.
If you get through to an estate agent, ask them for the contact
details of the auction house. The estate agent may be reluctant
to do this, so it is worth being persistent. |
Once you are able to make contact with the auction house, ask to
be put on their mailing list. Although there is likely to be
charge for this, you will begin to receive details of properties
due for sale.
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Before you bid
Having identified the property that you want to buy, you will
need to arrange finance. For most people this will mean
approaching a mortgage lender and it is important to do this in
advance of the auction.
Remember once you win a bid, you are legally bound to purchase
the property and you need to be able to pay within a set number
of days.
The mortgage lender will require a basic valuation of the
property, but it is advisable to invest in a full survey as the
property may be at auction due to structural problems, which the
basic survey would not pick up.
Before bidding for your desired property, you may want to attend
a few auctions to get a better idea of the experience.
Winning your bid
Set yourself a price limit, but do not get carried away and bid
beyond it. Having had a valuation done, you will have a good
idea of the market value and should not go above the amount
agreed with your mortgage lender.
If your bid is successful, you will be legally bound to purchase
the property and will need to put down a 10% deposit of the
property's selling price. You will be asked to sign a contract,
which you would have seen before the auction and the seller will
be legally bound to complete on the day.
Finally you will need to pay the remainder of the selling price
within an agreed period, such as 28 days.
Congratulations, you have just picked up an auction deal.
About the Author: Don Suter is Managing Editor of the UK
Property Portal (http://www.ukpropertyportal.co.uk/),
an online directory for UK property sales, rental, surveyors, mortgages,
conveyancing, property insurance, removals, news, investment and
development. For more information and advice, search our
property sales pages
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