Buying and Selling At Auction
- What is an auction legal pack?
- When should I instruct my solicitor?
- How do I view the properties?
- What should I take to auction?
- When do I need my deposit?
- Can I order a building survey on a property I am interested in?
- Can I change my mind after placing a successful bid?
- When will I be able to move in?
Selling at auction
What is an auction legal pack?
An auction legal pack is usually available to download from an auctioneer’s website prior to the auction and should be available as early as possible so that the buyer can pass it to their legal advisor. The pack contains the legal title to the property, the sale contract and any other relevant paperwork such as search results, tenancy agreements, an energy performance certificate and any guarantees available for the property. If you are interested in buying a property at auction, it is strongly advisable that you pass the auction legal pack to a legal advisor as soon as possible. They can check it over and let you have their thoughts on any potential issues or matters that need further investigation before auction. Remember, once you have bid at auction, the seller is no longer bound to answer any enquiries in relation to the sale and it may be too late to rectify any issues which could then prove costly.
What is an auction legal pack?
You should instruct a solicitor well in advance of the auction date to make sure that all issues are taken care of in due course.
How do I view the properties?
To view any properties you are interested in you should contact the auction house that is selling the property. Depending on the auction house, you will then be able to have a private or group viewing of the property: the auction house will let you know the dates available.
Buying at auction
What should I take to auction?
You will require a form of photographic identification, such as a current passport or UK photo driver’s license and proof of current address, such as a utility bill or bank statement which should be under 3 months old.
You must take enough money for your deposit; cash and credit cards aren’t usually accepted and some auction houses also do not accept debit cards. The deposit is usually paid via cheque or bankers draft, both of which are commonly received at auction houses. You’ll also be liable for administration costs and auctioneers’ fees: it is best to check with the auction house what these will be before bidding.
When do I need my deposit?
If you buy a property at auction you will need to make sure you have a 10% deposit (of the final purchase price) ready on the day of auction, when contracts are signed. You will need to pay the remaining 90% of the purchase price on the completion date, which is usually 20 working days after the auction date. Additional fees may be payable, depending on the auction house, so you will need to check with the specific venue you are attending. Your legal advisor will check the contract pack for any costs for which you will be liable, such as search fees.
Can I order a building survey on a property I am interested in?
Absolutely yes. You will need to pay for this yourself but we highly recommend that you have a building survey carried out on any property that you are planning on bidding for so that you are fully aware of any potentially costly issues relating to the property. For more information, see our information packed guide for successful bidding at auction.
Can I change my mind after placing a successful bid?
The fall of the auctioneer’s hammer enters you into a legally binding contract to purchase the property. Failure to buy the property after this stage will result in you losing your deposit (usually 10%). You will also be liable for the auctioneer’s fees.
When will I be able to move in?
Upon payment of the deposit after the auction, it usually takes 20 working days before completion. This is when you will pay the balance of the purchase price and receive the keys for the property.