I would like to look into buying a property at auction as I am a first time buyer, unable to get a foot on the housing ladder. After looking into various Goverment schemes, my only other option is shared ownership.
I would like to know the process of raising a mortgage for a property bought at auction.
I know that a 10% deposit is required on the day of the auction.
Is it a case of obtaining a mortgage in principle, purchasing the property and then applying for the mortgage after the sale?
I am assuming that no mortgage lender will lend money without there being a property in place to secure the loan on.
Any information on this would be appreciated
Many thanks
2007-09-30 20:19:01 · 6 answers · asked by Panoulis 1 in Business & Finance ➔ Personal Finance
Get a mortgage offer before going to an auction. Make sure the lender is able to complete your application within three weeks of the sale. If you don't have the moneyin your account in time to pay for the property you could lose your deposit.
Remember you have to complete within 28 days and don't forget to factor in stamp duty if you purchase over £60,000.
Good luck.
2007-09-30 20:29:19 · answer #1 · answered by Sal*UK 7 · 0⤊ 0⤋
The thing to do is to be pre - qualified for a mortgage at a reputable bank, so that once your at the courthouse and your bid has obtained a property you usually have 24 to 72 hrs to get the cashiers check to them, they might know about the property already or have an idea...you then go to the bank to finalize the money/loan. If its for rental/investment property a word of advice people fail because the think its there own monthly income, and they doi not start a corp or LLC so that a slip and fall is not limited to that property but persona;l property as well. A corp/LLC allows you to "loan" $ to the corp/LLC (5 years unless the property is really run down the repayment can start forms at office supply at going rate at the time for interest) The 2 or 3rd year or longer according to how run down or improvements you make() you get your profit via dividends usually yearly from the corp/LLC (most states its between 150 to 800 which is for the EIN and if your employees are service companies or you get a stamp stating the employees are Sub-contractors responsible for their own taxes the less employees your responsible for collecting the taxes from the cheaper the EIN is) the corp/LLC can be 25 to 50 bucks, so why wouldn't you? As board members you can collect a salary once the company can afford to pay but give it 2 years first and seek help from SBA
2016-04-06 22:06:39 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Get yourself a " mortgage in principle " IE the lender promises to lend you the money on the property if it meets their criteria.Be prepared to pay out for survey on a property you are interested in pre auction.Make sure you have your legal team informed well in advance as this side can slow things up considerably. Site survey & serches are very important ,as many properties ent up in auctions because they are unmortagble due to a variety of reasons. Best of luck !
2007-09-30 21:01:17 · answer #3 · answered by Max Power says relax 7 · 0⤊ 0⤋
I think you will have a hard time doing this because when you buy at an auction they want paid in full within a week or so, and you will never get a mortgage approved in such a short time
I believe you need a large line of credit in order to buy something at an auction. put it on your credit line and then try to get a mortgage to pay off your credit line
2007-10-01 06:53:49 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Impossible.
If you want to buy a property at auction you need to bring your checkbook.
2007-10-01 12:02:18 · answer #5 · answered by Anonymous · 0⤊ 1⤋
http://www.channel4.com/4homes/buyingandselling/how2buy/auction_bargains.html...this site might help you but the pages take ages to load well they for for me but you might not have to wait as long, good luck
2007-09-30 20:31:01 · answer #6 · answered by angie 5 · 0⤊ 0⤋