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FAQ

Intro:

Supporting clients is one of the top agendas here at Auction Finance Limited. Our auction specialists have devised some frequently asked questions to ensure you get the most from the property auctions which you attend.

Before an auction:
• Register on an auction house's mailing list to receive their
catalogue.
• Locate a property that suits your requirements and obtain details.
• Decide whether to attend the auction or bid by proxy, telephone or
on the web.
• If you have a property in mind, you can organise your finance
with us prior to the auction.

Before an auction bring:
Your cheque book - A 10% deposit on the day will be required (usually a minimum of £1,500)

Solicitor's details - The auctioneer will require details of which solicitor you are planning to use

ID - You will need to bring your original passport or driving licence and proof of residency to comply with Anti Money Laundering rules

After an auction:
After purchasing a property, contact an insurance broker to arrange insurance cover. You usually have up to 4 weeks
after the auction date to complete the purchase. However it can be as little as 10 days.

Auction Finance Limited can agree 'in-principle' loans BEFORE, DURING or AFTER an auction.
 

General Auction:

Q What is a property auction?

A sale of commercial and residential property at which you bid to purchase property there and then.


Q If I'm interested in a property prior to the auction should I

go and see it?
If you have time it is worth visiting the property to check the location. You may also be able to get the keys to have an internal inspection. Check the catalogue for viewing dates and times.


Q Can I see the legal documents of properties I'm interested

in?
Yes. Auctions have files with the deeds, Land Registry searches etc…


Q What happens to properties that don't reach their reserve price?

At the end of the auction the vendor may agree to sell the property at a lower price. Ask the auctioneer if you can register your interest for such properties.

Buying at Auction:

Q How much should I bid on a property?

Only what you have previously calculated you can afford.


Q If I win the bidding do I have to buy the property?

Yes. Once the hammer falls you are legally bound to buy the property.


Q What details should I take to the auction?

If you expect to buy a property take:
• Two forms of identification
• Your cheque book
• Bank details
• Solicitors' details


Q What happens to properties that don't reach their reserve

price?
At the end of the auction the vendor may agree to sell the property at a lower price. Ask the auctioneer if you can register your interest for such properties.

Finance:

Q How much can I borrow?

Lenders will generally lend based on the valuation or the purchase price/guidance price, whichever is lower. Often they will lend about 70 - 80%. Be aware, however, that properties don't always sell at the guide price at an auction – it could be more, or less. Always decide in advance the maximum price you can afford to bid on a property.


Q What is a bridging loan?

A bridging loan is short term finance usually taken out from 1 to 12 months. It is an interest only facility that helps with buying a property and completing the purchase almost immediately. This type of loan can sometimes be repaid by refinancing it on a long term basis or selling the property.


Q Which is more suitable for buying at auction, a bridging loan or long term finance?

As an example, bridging loans may be more suitable if the property is to be sold soon after purchase, or refinanced with a long term loan. Long-term finance may be more appropriate if the property is to be held on to for a number of years.