At Elite Law, our experienced team of auction property solicitors offer expert services for both selling and buying a property at auction.
Property auctions are a popular alternative to the traditional methods of buying and selling property through estate agents. Opting to buy or sell at an auction is usually cheaper and faster, with fewer parties involved and contracts being binding as soon as bidding ends.
Because of the quick turnaround of auction sales and the binding nature of the process, it is extremely important that all parties are well prepared and have carried out the necessary research prior to listing or bidding on property. For that reason, we strongly suggest seeking legal advice from experienced auction property solicitors before you attend a property auction.
Our commitment to an exceptional level of client service and competitive fixed fee rates have helped us cultivate a reputation as reliable and cost-effective auction property solicitors. Our team of experts act for clients throughout England and Wales.
What is the process for buying a property at auction?
Buying property at auction can be an exhilarating experience, but it can also be an intimidating one. Before attending an auction with the intention of bidding, we would strongly recommend going a few times to spectate and familiarise yourself with the process and environment.
Going into the auction process with a good understanding is invaluable. While auctions are often cheaper, it pays to know what you are doing and how everything works to ensure the best possible outcome. Here is what you should expect:
Before the auction: auction property solicitors to check the legal pack
Prior to the auction day, doing extensive research into properties and arranging viewings can ensure there is no mystery to the purchasing process. You can request a catalogue from the auction house that will include details and information on all properties up for sale. From there, you can shortlist suitable properties and make appointments for viewings individually.
It is worth noting that many auction properties are investment properties. You are unlikely to see new builds available on auction, and extensive renovations may be required – which should be factored into your finances.
The auction house will provide guide prices for the properties they list. Doing your own research can provide you with further insight into a fair price for a specific location and type of property.
If you are interested in any auction properties, you can request the legal pack from a specific auctioneer.
You should examine the legal packs made available usually a week or so (sometimes earlier) before the actual auction. These packs contain everything you need to know about each property for sale, including the contract, land registry details, and any relevant restrictions. We have covered all the information included in a legal pack in further detail below.
It is important that you thoroughly scrutinise these packs before committing to a purchase, ideally with input from experienced auction property conveyancing solicitors. An appropriately qualified solicitor can review the legal back and ensure everything is as it should for the cost advertised. At this point you can also schedule a survey of the property, to ensure you are happy with everything prior to bidding.
Finally, you will need to ensure your finances are in order as you prepare to bid at auction for a property. If you are not paying in full, you will be required to have a mortgage in principle in place before the auction begins. You will also need to prepare to cover auction fees, insurance, and stamp duty. Once the hammer falls, the sale is final, so it is crucial to have everything in order ahead of time.
The day of the auction
The day of the auction is a far easier process than the build-up itself. Whether you are attending an auction in person or joining in online, you will want to make sure you turn up on time and have all the required documentation and information necessary. This includes your 10% deposit for the property, as well as two forms of identification.
When an auction begins, you can make as many bids as you want within your limits. If you are the highest bidder, you will win. You must then pay your deposit and fees that day. If you were the top bidder but the property came in under its reserve, the seller may still approve the sale. Alternatively, you could approach the seller to discuss further options.
After the auction
Following the auction, the process of buying a property at auction is the same as buying property in any other way. You will be required to pay the remaining 90% of your winning property bid within a set amount of time following the auction. This may in some circumstances be as short as 14 days.
You will also need to go through the conveyancing process to ensure all legal needs are met for the property purchase. Our expert auction property solicitors can support you through the post-auction process to make your purchase is as smooth and easy as possible.
What are the Terms and Conditions governing an auction purchase?
There are two important sets of terms and conditions governing an auction purchase. The General Conditions are the conditions that apply to every property being auctioned – these are available on request. The Special Conditions are the different conditions that apply to each individual property, which are set by the seller before the auction. These can dictate anything from the date of completion to the penalties for not completing, so it is very important that you read them carefully. If you have a solicitor reviewing the auction pack for a property, they will be able to review the Special Conditions for you as well.
While each set of Special Conditions are different, it is becoming increasingly common for Special Conditions to require that the buyer of the property pays a contribution towards the seller’s auction costs and legal costs. This can mean several thousand pounds of extra expenditure in some cases, so it’s important to bear this in mind when budgeting.
How would you fund the auction purchase?
The timeframe to complete auction purchases can be short – often as little as 2-4 weeks. This rapid turnaround time means that traditional mortgages often cannot complete in time.
Depending on your situation it may be possible to complete the purchase with cash, especially if the asking price is low. Alternatively, specialist finance such as bridging loans may be an appropriate option. A bridging loan will often be available for drawdown within weeks, which makes it ideal for auction purchases with short deadlines. If you are considering this option, it is always worth speaking to a specialist bridging loan broker for advice – bridging loans can be expensive, and may not be right for you.
What is the process for selling a property at auction?
Do you have plans to sell a house or other property at auction? It is in your best interests to go into the process with the knowledge and expertise needed for success. As with any property sales process, you will need to carry out certain preparations upfront to ensure you are ready to go to auction.
Getting the advice of experienced auction property solicitors can be extremely useful during this process. Amongst other things, we can advise you on what to include in your legal pack to ensure that all information is accurate and well-presented, which will make your property more attractive to buyers and will minimise the possibility of any disputes arising after the sale has been completed.
Preparation for sale at auction
Typically, you will need four or more weeks before the auction to prepare your property for sale. The first step of this is reaching out to different auction houses and requesting appraisals. Each auctioneer will suggest fees and reserve prices, allowing you to choose the option best suited to you. Your chosen auction house will work with you to prepare your catalogue entry for the upcoming auction listing.
Following this, you will need to complete a legal pack with the support of appropriately experienced auction property conveyancing solicitors. This legal pack includes property searches, basic information, and guidance for potential buyers. We have covered further details on the preparation of legal packs below.
The day of the auction
The day of the auction is straightforward for sellers. Much of your preparation work is ahead of the auction, and you can watch and see what happens on the day. All prospective buyers will be able to bid on your property, and once the gavel has fallen, the highest bidder is legally contracted to complete the purchase.
Completion and follow-up: auction property solicitors for conveyancing
Once a sale has been completed, and the 10% deposit received, the standard conveyancing process follows your property sale. At Elite Law Solicitors, we have an expert team of auction property solicitors who can support you with your legal requirements, ensuring the completed sale of the property is as fast and easy as possible for all parties involved. Should the property not sell, the auctioneer may approach potential buyers, or you can opt to relist at a later date.
What does reviewing an auction legal pack involve?
If you have plans to purchase a property at auction, doing your due diligence should include a thorough review of the property’s legal pack with appropriately qualified auction property conveyancing solicitors. A specialist solicitor will do most of the work for you and will be able to advise on any loopholes, issues or notable information available in a legal pack via a summary of the contents.
Auction property solicitors should check matters such as the special conditions in the auction contract which may vary considerably from the conditions in a contract when you buy a property in the normal way, and which may include reduced time periods and excessive legal and other fees.
You should check that the property has appropriate rights of way and the covenants in the property register will not adversely affect you, especially if you had specific plans for the property which are prohibited by the covenants.
You should also consider that in some cases the seller may be selling the property at auction as there may be a fundamental legal problem – appropriately experienced auction property solicitors can look out for and advise on any such issues.
What does preparing an auction legal pack involve?
When you sell a property at auction, you are required to create and prepare an auction legal pack. This pack provides potential buyers with detailed information about the property they may want to purchase. With the support of appropriately qualified auction property conveyancing solicitors, bringing together the necessary information is not an arduous task. Your auction legal pack should include:
Information on title deeds
Local and other property searches and land registry
Special conditions of sale
Form for fixtures and fittings
Form with property and management information
Details of leases
Any tenancy agreements
Documentation for planning permissions
How long does it take to sell a property at auction?
The time from preparing your property to completing the sale could be anything from 8-12 weeks on average. However, the time it takes will depend on if your property sells the first time, how long initial preparations take, and any complexities in the conveyancing process post-sale. Experienced auction property solicitors can take the necessary steps to help reduce the time it takes to complete the transaction.
Can I pull out after I have won the auction?
Once the hammer has fallen, the sale made at an auction is final. Neither the seller nor the buyer can pull out without facing penalties. For buyers, this can mean forfeiting the full 10% deposit and all other fees they have already paid if they cannot meet their legal obligations.
Do I need to instruct auction property solicitors when buying at auction?
For the purchase of any property, seeking the expert insight and support of a solicitor is invaluable. When purchasing at auction, this is even more integral given the need to evaluate and understand legal packs prior to making your purchase. With the expert guidance of our specialist auction property solicitors, you can rest assured that you will understand every aspect of your purchase with no unexpected fees or costly mistakes in the process.
How much do auction property solicitors charge?
The cost of auction property conveyancing services will vary depending on your exact needs.
At Elite Law Solicitors, we favour quoting fixed fees, which will only change if your requirements change during the process or if due to unforeseen circumstances the process is taking longer than expected.
Buying or selling property at auction is an excellent way of circumventing the usual problems associated with buying or selling property. Fewer fees and no chains mean sales are usually completed quickly and painlessly. This process runs smoothest when both buyer and seller are properly prepared and well-informed. A comprehensive legal pack is a must for a successful sale, and understanding the contents of these packs and the results of any surveys is essential for a buyer looking to make a smart purchase.
Our expert auction property solicitors have a thorough knowledge of auction sales and purchases. They are aware of what to expect the pitfalls to avoid at a property auction. Our solicitors have years of experience both producing and interpreting legal packs and guiding clients through the auction process. We have been awarded the Law Society’s Conveyancing Quality Scheme Accreditation which demonstrates our knowledge and expertise in all aspects of residential conveyancing.
One of our experienced auction property solicitors will have an initial consultation with you, free of charge, to discuss your situation in more detail. Once we understand your circumstances better, we can provide you with a clearer understanding of how we can help you. We will also provide you with a price quotation and a choice of funding methods at the outset.
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