Buying a repossessed home from the bank etc.
Discussion
Just about to go and view a house that is being sold by the mortgage lender as a repossession. After speaking to the agent he explained that they typically will hold out for an offer of the asking price for the first two weeks then be more open to lower offers after that. However, even after they accept an offer should a higher offer be received they will then accept that.
I don't particularly fancy losing out on all of my search/legal fees etc. should I offer.
Anyone got any positive stories about buying in this situation to convince me it's not a terrible idea.
I don't particularly fancy losing out on all of my search/legal fees etc. should I offer.
Anyone got any positive stories about buying in this situation to convince me it's not a terrible idea.
SHutchinson said:
Just about to go and view a house that is being sold by the mortgage lender as a repossession. After speaking to the agent he explained that they typically will hold out for an offer of the asking price for the first two weeks then be more open to lower offers after that. However, even after they accept an offer should a higher offer be received they will then accept that.
I don't particularly fancy losing out on all of my search/legal fees etc. should I offer.
Anyone got any positive stories about buying in this situation to convince me it's not a terrible idea.
the Law requires them to take the most they can as to mitigate their loss ... I don't particularly fancy losing out on all of my search/legal fees etc. should I offer.
Anyone got any positive stories about buying in this situation to convince me it's not a terrible idea.
mph1977 said:
the Law requires them to take the most they can as to mitigate their loss ...
I fully appreciate that, I mean to ask, has anyone else bought in this situation and it was all fine in the end?I guess I may have to see my search fees as a gamble up until the point the sale completes.
We bought under these circumstances. Had an offer of £8000 less than the banks asking price accepted. We only had 28days to complete from our offer being accepted. We were quite worried about someone else coming in with a higher offer, however the estate agent agreed they would actively discourage any other viewings. All went well in the end and we are set to make a healthy profit.
Mr Obertshaw said:
We bought under these circumstances. Had an offer of £8000 less than the banks asking price accepted. We only had 28days to complete from our offer being accepted. We were quite worried about someone else coming in with a higher offer, however the estate agent agreed they would actively discourage any other viewings. All went well in the end and we are set to make a healthy profit.
Regardless of what the agent told you they need to put a notice in the local paper seeking better offers within 2 weeks.Lenders in possession are pretty ruthless vendors, it's business, they need the highest sale price and it's not personal.
Twice. First one. Made an offer, accepted. Went through
Second. Made offer at asking price. Friendly with estate agent. They put a notice of offer (my offer) in an obscure free property paper that was only available from one shop in the area (I may have taken the entire pile ;-)... Estate agent told me someone bettered it (since found out it was A neighbour)
I went 2.5k more (technically I wasn't supposed to know what their offer was, wink wink)
In all cost me 5k more than asking, which was extremely low in the first place.
Estate agent was on a fixed cost from RBS to sell. So he just wanted a quick buyer with little hassle, but obviously had to demonstrate that all efforts were made to get the best deal for the bank, and potentially the previous owner if they had any equity left.
Second. Made offer at asking price. Friendly with estate agent. They put a notice of offer (my offer) in an obscure free property paper that was only available from one shop in the area (I may have taken the entire pile ;-)... Estate agent told me someone bettered it (since found out it was A neighbour)
I went 2.5k more (technically I wasn't supposed to know what their offer was, wink wink)
In all cost me 5k more than asking, which was extremely low in the first place.
Estate agent was on a fixed cost from RBS to sell. So he just wanted a quick buyer with little hassle, but obviously had to demonstrate that all efforts were made to get the best deal for the bank, and potentially the previous owner if they had any equity left.
Edited by Aviz on Tuesday 2nd February 16:54
Sharted said:
Regardless of what the agent told you they need to put a notice in the local paper seeking better offers within 2 weeks.
Once past that point you *should* be OK. I guess you don't start spending money until then.The bit about EA's putting people off is correct in our experience - once a buyer is in progress they just want it to complete and get their commission ASAP. Even if they're on a percentage the extra commission for them is negligible.
I missed out on one recently. I offered the asking price initially and was outbid on the first day of my offer being advertised. It was then a bidding war and I went £6k over the asking price, which was a much as I could afford. There was a bit of drama over the other party not having their mortgage in place like they were supposed to, and their estate agent not advertising their offer as they were supposed to, so it looked like the vendor would come back to me for a while as I had everything sorted. The vendor still went with the other party though.
i went through this. The EA will generally be on a fixed fee so talk to them about any previously declined offers to get an idea of acceptable bids. In the end we put in for 97% of asking and got accepted. Then get on the case of your mortgage broker if you have one and chase your conveyancer daily
We put our offer in on the 1st Dec 13 and exchanged on the 21st. That included the new mortgage in 2 days and a BTL for our old house to allow for equity release so it can be done.
We put our offer in on the 1st Dec 13 and exchanged on the 21st. That included the new mortgage in 2 days and a BTL for our old house to allow for equity release so it can be done.
I've put an offer in on it today. The house is full of the previous occupiers belongings and access to the property has clearly been gained by force. I've accounted for this in my offer, but I guess the vendor doesn't care, it's just figures on a spreadsheet.
I'll see what happens I guess.
I'll see what happens I guess.
I was the ruthless b
d who jumped in with a higher offer when the offer was posted in a local paper. I viewed the house and offered 5k more than the accepted offer. I needed a mortgage and was a ftb'er and I was up against a cash buying investor, so knew I would be lucky to get a look in. Luckily because I offered 5k higher and explained my reasons and understood the process of completion they accepted. We completed 19 days later and we still live here now, raising our kids and enjoying the area.
Just make sure you understand the risks. You can easily lose your conveyance and search fees. Always use a mortgage advisor, they know who will and who won't get the job done on time. Go with the one he recommends on timescale, every day it drags on is a day someone can drop another offer in. My house was circa £30k below market value, that's not to be sniffed at and has done very well for us with the improvements we made. So decide if the risks are viable to you and go for it.
d who jumped in with a higher offer when the offer was posted in a local paper. I viewed the house and offered 5k more than the accepted offer. I needed a mortgage and was a ftb'er and I was up against a cash buying investor, so knew I would be lucky to get a look in. Luckily because I offered 5k higher and explained my reasons and understood the process of completion they accepted. We completed 19 days later and we still live here now, raising our kids and enjoying the area. Just make sure you understand the risks. You can easily lose your conveyance and search fees. Always use a mortgage advisor, they know who will and who won't get the job done on time. Go with the one he recommends on timescale, every day it drags on is a day someone can drop another offer in. My house was circa £30k below market value, that's not to be sniffed at and has done very well for us with the improvements we made. So decide if the risks are viable to you and go for it.
My first home was a repossession. However, some people seem to act ask if that means that the house is somehow offered at a bargain knock down price. It rarely is. What you definitely have is the chain ending with your purchase and a vendor who definitely wants to sell and won't change their minds for emotional reasons. They will however change them for financial reasons.
Repos are sometimes cheaper, as they are in a poor state of repair. The cost of putting them right often brings the total cost of the house back to the true market value, so take stories of mega deals with a pinch of salt. Having said that, the state of the local housing market will dictate what offer might be accepted.
The vendor has to demonstrate that they have got the best price that they possibly can, hence the need to place the second advert for two weeks to entice any other bidders out of the woodwork. This is to cover them if they have to go to the original borrower and ask for more money / claim on the mortgage indemnity policy, who will then tprevery to the original lender to cover their loss.
I got a reasonably good deal on my first house because it was in the early 1990s, interest rates were high and climbing and we were in the middle of the Exchange Rate Mechanism crisis, which pushed them to c25% for a few days. The house had been on the market for two years and was in significant disrepair, whilst the housing market had pretty well collapsed. The original asking price had dropped from £55k to £40k, I got it for £36k, which was about right given the work it needed. After repair costs I paid what I'd have paid for a modernised one on the open market, so no mega deal.
Repos are sometimes cheaper, as they are in a poor state of repair. The cost of putting them right often brings the total cost of the house back to the true market value, so take stories of mega deals with a pinch of salt. Having said that, the state of the local housing market will dictate what offer might be accepted.
The vendor has to demonstrate that they have got the best price that they possibly can, hence the need to place the second advert for two weeks to entice any other bidders out of the woodwork. This is to cover them if they have to go to the original borrower and ask for more money / claim on the mortgage indemnity policy, who will then tprevery to the original lender to cover their loss.
I got a reasonably good deal on my first house because it was in the early 1990s, interest rates were high and climbing and we were in the middle of the Exchange Rate Mechanism crisis, which pushed them to c25% for a few days. The house had been on the market for two years and was in significant disrepair, whilst the housing market had pretty well collapsed. The original asking price had dropped from £55k to £40k, I got it for £36k, which was about right given the work it needed. After repair costs I paid what I'd have paid for a modernised one on the open market, so no mega deal.
I always thought buying a repo was a straight forward fast process until we bought our current place. Came on the market in March and eventually completed in October, 2 years ago.
I think at one point according to the agent there was 10 bidders. We had to initially demand to watch the agent submit our offer as we found out offers weren't being submitted. Bidding went from 180k all the way to 315k , back to 180 and back up. Was the most stressful time I have ever had , and now were 2 years into a rebuild/refurb project as the house was classed uninhabitable by the council
I think at one point according to the agent there was 10 bidders. We had to initially demand to watch the agent submit our offer as we found out offers weren't being submitted. Bidding went from 180k all the way to 315k , back to 180 and back up. Was the most stressful time I have ever had , and now were 2 years into a rebuild/refurb project as the house was classed uninhabitable by the council
Superbad said:
I've always wondered where these kinds of properties are advertised?
Rightmove etc or elsewhere?
They are sold via normal estate agents as normal empty houses with no chain. There isn't some secret selling place and they aren't sold for 50p. If you view a house that's empty then always ask if it's a repossession, the agent will tell you, although the mess inside is often a dead giveaway. Rightmove etc or elsewhere?
JacquesMesrine said:
Superbad said:
I've always wondered where these kinds of properties are advertised?
Rightmove etc or elsewhere?
They are sold via normal estate agents as normal empty houses with no chain. There isn't some secret selling place and they aren't sold for 50p. If you view a house that's empty then always ask if it's a repossession, the agent will tell you, although the mess inside is often a dead giveaway. Rightmove etc or elsewhere?
If it all goes to plan, the upside is that I get a house full of crap and a massive trampoline in the garden and an urgent requirement to replace/repair all of the locks in the property. Ah well, I did fancy a project and it shouldn't take too long to sort.
Our current house was a repo, unfortunately the value exceeded the mortgage value, so we had to deal with 'Move With US' who acted on behalf of the debt owner, the debt owners solictitors (Irwin mitchell - who were a showe of well stuuf), and a solicitor for the beneficiaries(of whom there were six!). We sold our house and moved in with the in laws to make things as simple as possible. The previous owner died and left complete chaos of multiple names and questionable ownership. I got so bored with it I even made a diagram to explain to family how complex the who thing was.
It was a nightmare and took 11 months from seeing it to completing, we didn't think we were buying it for 2 months after another offer was accepted and then pulled out. We probably got it cheap but probably at market price as it had got quite run down with the previous owner being advised to not spend any money on it while they were there as the were unlikely to see it back. That said, it was worth it, with prices rising in our area over the year and our list of desires being in short supply, we didn't see anything else that ticked our boxes for the money in that period - and after the first two months of f#*kwittery (after they had demanded 28 day exchange) we started looking quite seriously!
It was a nightmare and took 11 months from seeing it to completing, we didn't think we were buying it for 2 months after another offer was accepted and then pulled out. We probably got it cheap but probably at market price as it had got quite run down with the previous owner being advised to not spend any money on it while they were there as the were unlikely to see it back. That said, it was worth it, with prices rising in our area over the year and our list of desires being in short supply, we didn't see anything else that ticked our boxes for the money in that period - and after the first two months of f#*kwittery (after they had demanded 28 day exchange) we started looking quite seriously!
SHutchinson said:
Yup, it was just up on Rightmove. The first agent said it was being sold by a corporate client, keeping her cards very close to her chest. The second agent told me that bank were offloading it as it was a repossession. Presumably he veered from the script!
If it all goes to plan, the upside is that I get a house full of crap and a massive trampoline in the garden and an urgent requirement to replace/repair all of the locks in the property. Ah well, I did fancy a project and it shouldn't take too long to sort.
Don't worry about the locks. They are always changed immediately once possession has been gained by the lender, for obvious reasons. A locksmith attending the repossession is always a must. If it all goes to plan, the upside is that I get a house full of crap and a massive trampoline in the garden and an urgent requirement to replace/repair all of the locks in the property. Ah well, I did fancy a project and it shouldn't take too long to sort.
After my initial concern about the time-scales being compressed due to the desire of the bank to complete within 28 days . . . . . they've sat on my offer for a week without accepting or rejecting it.
Ah well, hopefully they'll get a wriggle on shortly. I've got an urge to start buying Polyfilla and trade tubs of white paint! (I secretly mean more power tools but I have to at least pretend I'm going to do the fiddly bits).
Ah well, hopefully they'll get a wriggle on shortly. I've got an urge to start buying Polyfilla and trade tubs of white paint! (I secretly mean more power tools but I have to at least pretend I'm going to do the fiddly bits).
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