Vetted by a Commercial Broker
Ensure you have your lending agreed in the background. If you buy at Auction you will need to lay down your deposit of 10% deposit (Traditional Auction) or reserve fee (5% Modern Auction), immediately, and the exchange of contracts (completion) will need to be finalised in 28 days (Traditional Auction) and 56 days (Modern Auction).
An experienced Commercial Broker that specialises in Auction Finance, can look into your credit score, and present you with lenders that would be likely to accept an application based on your circumstances.
Typically, Auction buyers are interested in Bridging Loans, and Buy-to-let Mortgages.
Speak to your Solicitor
A solicitor is also an important part of the Auction buying process. Things like assessing legal packs, for searches and covenants are very important prior to buying a property. Failing to look through a pack, could result in a shock later down the line when the buyer finds there are restrictions to property or land use.
Ensure that you have the correct deposit. It would be a good idea to look through Auction brochures, for a guide prices. However also take into consideration reserve price, usually adding another 8-10% on top of the guide price would be a good indication of the minimum price the seller is willing to sell the property.
Ensure you have the deposit ready to put down immediately (are able to transfer monies online or via a card without hitting your daily banking limits).
Using an experienced broker for Auction lending is important and they will have knowledge about the market and which lenders are likely to give out loans for Auction purchases.
Once the bid has been won, and the respective deposit or reserve fee paid, the buyer has up to 28 days to complete the purchase (Traditional Auction) and 56 days (Modern Auction) or could forfeit the reservation fee or deposit and any other fees that you may pay.
Need Auction Finance
Interested in Auction Finance? Journey Mortgages can help you with loans for Auction properties. Get in touch via our contact section and we will be happy to take look at what is available.
Attention: Late repayments can cause you serious money problems. For help go to moneyhelper.org.uk