The great thing about buying a property at auction is the fact that you can get a great deal. After all, you can name your price, as long as you don’t get outbid. Plus, you can avoid the annoyingly long purchasing protocols involved with buying real estate, and you don’t have to worry about a deal falling through at the last minute. Basically, if you’re at an auction and you have the highest bid, the house is yours right on the spot.
This doesn’t mean, however, that you should take the process of buying a house at auction lightly. Check out the top tips below so that you can make the entire process easy and make it work for you.
See the Property in Person First
If you are able to view some properties in a catalogue before the actual auction takes place, do so. In this way, you can pick out a few of the homes that you like the best and then actually visit them to see them in person. This will give you the opportunity to really get a feel for what a house is like, including its size and how much repair it really needs. You can even bring a builder or surveyor along with you so that they can give you some feedback in terms of what the property would need if it were purchased.
Have Your Money Ready
Whether you are heading to luxury real estate auctions or you are looking for a really cheap fixer-upper, have your money ready beforehand. A lot of people find that they run into problems when it comes to financing a home that they purchased at an auction because their lender is not be able to meet the tight deadlines. But if you work with an adviser, especially someone with experience in the auction financing process, you can locate a specialist lender. Or you could instead secure a mortgage before you go to the auction if you have picked out the property that you want but you do not yet have the money available in your bank account.
Be Aware of Extra Fees
Even though purchasing a property at an auction means that you can avoid dealing with tons of paperwork and real estate agent fees, there are some other fees that you should be aware of. The exit fee, for example, will be a percent of your total loan, and you may be charged this fee when you actually settle your loan. You may also encounter a lender who charges you monthly interest for simply fast-tracking the mortgage that you need. And those introductory, super low interest rates may only be available for a limited time, so don’t fall into the trap of thinking you can get one and miscalculating how much you’ll really owe if you purchase.
With these helpful tips in mind, you can head to your first real estate auction with confidence, as well as improve the way you approach auctions if you’re already experienced in them.