Buying a property at auction is usually through Bridging Finance as you normally have 28 days to complete on the purchase. Long term lenders will find it very difficult to get the mortgage agreed and paid out within such a short period of time.
We can take away the uncertainty by agreeing to the finance before you bid. All we need is your personal details, the auction house, lot number, maximum bid and your plans for the property.
If you don’t have time before the auction, contact us once your bid has been accepted.
Ten Points to consider when looking for Auction Finance
- Term of the mortgage, as often lower rates are quoted for shorter terms but if you don’t repay on time the rates can be much higher;
- Always get your own valuation as not all lenders require one;
- Can your solicitors be instructed the same day or can you use the lender’s solicitors to save you time;
- Do your solicitors have experience of dealing with bridging finance;
- What level of refurbishment will the lender accept;
- Don’t just focus on the interest rate. Add all the costs up to compare one lender to another;
- Is interest calculated daily or monthly as the latter can be more expensive;
- If using a broker ensure they fully understand bridging (a lot don’t) and they deal directly with the lender as we do. A lot go through a third party which will increase your costs and be much slower;
- What happens if you are late when repaying the loan? Some lenders are flexible others will be in court to repossess before you know it;
- What is your exit? Your Plan A, B, C etc. Work on this before you apply for the loan.
- 1 – 24-month options;
- Up to 75 – 85% of the purchase price;
- Up to 100% finance with additional security;
- Interest can be serviced or retained;
- Fee-free options.