Buy Undervalued Repossessed Properties

 

Quick repossession buying tips

Repossession doesn’t always equal bargain. Thus it's essential to view other properties and research the area thoroughly, as you would with any other new house.

  • Investigate the property.

Transport links, employment levels, schools; all need to be carefully considered. There’s a full guide to free tools to investigate a property; read the Free House Price Valuations guide.

  • Get a good mortgage deal.

If you’re hunting for a new mortgage, speak to a mortgage broker. Read the Cheap Mortgage Finding& Free Remortgage guide for more.

  • Know they don't have to take the house off the market.

It’s worth noting that often lenders are allowed to continue marketing the property, even after they’ve accepted an offer, leaving the chance you'll be gazumped. This could mean survey and legal fees down the tube. Of course this is common in all types of property transactions. But it’s worth completing as soon as possible.

  • Don’t buy a wreck!

Your best bet is to visit the property several times, crucially, with a solicitor or surveyor. There are properties out there for under £20k, yet you must get a survey done to reveal any horrors before making an offer.

This is particularly important with repossessions; there could well be hidden defects that meant the seller was not able to get rid in time to pay off the debt. Plus, there are no existing owners to pass on helpful tips about the temperamental boiler and how next door’s disputing the height of your hedge. Locate a surveyor on the Rics website.

  • Check out what the situation with residents is.

Do confirm that the previous tenants have handed over the keys and the property is unoccupied. If the repossessed property was previously owned by a buy-to-let landlord, it is possible that the property may be resold with a tenant in situ.

  • Switched-off utilities.

A small fly in the ointment is that when you move in, some services, such as gas and electricity, may have been cut off. Most energy companies will switch them back on for free, but you may have to pay for phone line reconnection.

  • Check your credit rating.

It’s worth checking your credit rating a few months after you’ve moved in, just to make sure your finances don’t get incorrectly mixed up with the previous owners’.

While this is highly unlikely, you should be checking your credit file regularly anyway; the Credit Ratingguide shows how to instantly get all your credit files for free.

  • Check the post.

Do keep an eye on the post for red debt collection letters addressed to the previous owners. Give the companies a call and let them know that the previous owners have moved on, just to make sure they don’t turn up on your doorstep.

 

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