When you have a perfect location in mind for your dream home but are struggling to meet the house prices in that area, then you may want to consider purchasing a repossessed property.
This can be a great move if the right checks are done beforehand, as it can mean buying a property for much less than what it would normally sell for.
As estate agents in Leicester for many years, the team at Readings has sold a huge variety of properties, including those which have been repossessed and sold at auction.
And these unique properties can be some of the best buys around at up to 30% less than their market value. However, one of the best pieces of advice we can give is to do your homework and be prepared beforehand when buying a repossessed property or buying at auction.
Know all about your purchase inside and out before taking the step towards buying and get professional opinions when it comes to the state the property is in.
What is a repossessed property?
A repossessed property is one which has been taken back by mortgage lenders, banks or developers when the owners have been unable to make the mortgage or secured loan repayments.
Normally, the seller will be looking to sell the property quickly, in order to make back any mortgage arrears and this is why repossessed properties can often be bought cheap.
However, it’s no easy ride, as it also means they might not accept a bid from someone who is in a chain. In addition, the need to get the best possible price means that the seller could take up a higher bid right at the last minute.
Inspect the repossessed property thoroughly
It’s important to be aware that, when a property has been repossessed, you won’t have the benefit of the knowledge of the previous owner (someone who has lived in it).
You, therefore, won’t be able to find out, for instance, whether there have been alterations or underlying issues.
As such, there are several important checks to make on your house viewing checklist and a few steps to take in ensuring that what you’re buying is the great bargain that it appears to be:
- Inspect the property thoroughly inside and out a few times, checking for signs of wear and tear, damp, infestation, flooding and other issues.
- Have a survey done for added reassurance.
- Have your mortgage offer approved before putting in your offer.
- Know how much you can realistically go to, if someone comes in with a higher offer.
- Check whether service charge accounts are in arrears as you could be liable for them.
- Perhaps suggest a small reduction in the price to cover it.
Other debts don’t matter
When buying a repossessed property you may be concerned about other debts registered against the property that you might be pursued for as the new owner.
The good news is that these should be written off and taken off the title before the sale is complete. Also, any demands for payment of the previous owner’s debts can be resolved easily.
Our team of experienced Leicester estate agents often sell repossessed properties, including those at auction. If you need help or advice about buying a repossessed property in Leicester contact us today.