• Sat. Sep 18th, 2021

Real Tech 4 Life

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How to buy a house at auction: what you need to know

Currently, the sale of properties at auction is the order of the day and more and more people are taking advantage of it. In fact, understanding how buying a home at auction works can get you a much lower price, but it can also come with a whole host of risks and problems that are often underestimated.

However, thanks to the reform model of the civil procedure law, one of the major obstacles that existed to access a real estate auction has been eliminated, namely the reduction of the guarantee necessary for the presentation and participation in bids in these auctions. .

Before now, in fact, the value of the transaction of the house or property for which the offer was envisaged was fixed at 20%; this value was instead lowered to 5%. This advantage further encouraged customers to purchase real estate through auctions, as they saw a good opportunity to secure a home quickly and inexpensively.

Let’s see together what it means to buy at an auction. an online real estate agency that relies on technology and the best agents in the area to guarantee its customers a correct property valuation and to sell a house online at the best price and in the shortest possible time. By simplifying the processes, it is able to offer a service with ZERO commissions for those who sell, keeping the human relationship between customers and agents at the center of its offer through its real estate agencies in the area.

Which houses are sold at auction?

There are several reasons why a house is sold through an auction, if it has been foreclosed and returned to the bank (which is assigned the house for 70% of its appraised value), the bank sells it at auction to free itself. promptly of the property.

There are also some auctions run by local authorities, which come into play when the owner does not pay taxes on the house itself.

In both cases it is possible to understand how to buy apartments for sale for much less than their real value; however, as already mentioned, there are several potential risks to be considered. Here’s what they are and why this possibility exists. Do you want to buy a house? helps you find the right house at the right price! THE SEARCH BEGINS

What to know before participating in an auction

When you buy a house at auction, you accept it as it is; therefore, if the structure has any problems, such as excessive humidity or some structural deficiency, the cost of any renovation work will be completely at your expense.

On the other hand, when you buy a house in the traditional way, you always have the possibility to inspect the building and, if any problems arise, you can ask the seller to have them repaired at his own expense or at least to get you a discount on the total price of the house. ‘immovable.

Since you can’t do this if you buy the house at auction, you should consider the possibility that it needs repairs and take any additional costs into account when making your bid.

How to buy at auction

If you win the auction, you have the obligation to pay immediately for the house you have just won and for which you have bid; therefore, unlike a traditional purchase, you don’t have the option or the ability to get a mortgage.

In this case, you must therefore make sure that you have the cash available or the approval of your bank.

Otherwise, you may be subject to fines and penalties and even sued for any additional expenses incurred by the seller for your inability to pay.

They may still be busy

In some cases, the homes sold at auction may continue to be inhabited by their previous owners, and since you have bought the property as it is, you will have to take care of evicting them. Illegal occupants, in fact, could request a sum of money to leave the house without creating opposition.

Banks do not provide details on the house

In some cases, banks are unaware of fraud or pending allowances on the property they are auctioning. For this reason, you should never assume that the documents will be clear just because they are owned by a bank.

The latter, in fact, when selling a house at auction often declares that the buyer has carried out the required research and will not be held responsible for any outstanding debts. So, to avoid getting involved in similar situations, it is advisable to check these aspects so that there are no surprises after the purchase.

However, through the cooperative housing companies, it is possible to know if there are outstanding maintenance fees or unpaid taxes. Alternatively, you can also contact the municipal office to find out if there are any slopes related to water, electricity and gas utilities on a specific property .

As banks take time to foreclose on properties and auction them off, utility providers usually stop lending and won’t allow you to reactivate it until you have paid off the accumulated debts from the previous owners.