There are many stages and factors to consider in the process of buying a repossessed house in the UK. Here, we’ll outline the process from start to finish whilst detailing how long it takes for a repossessed house to be sold.
A repossessed home arises when a lender takes the property back from the property owner, either through the foreclosure process or by making an agreement with the. Buying a repossessed house involves more effort than a simple home sale. However, an investor has the chance to reap the rewards from additional effort and research by purchasing a repossessed property at below market value (BMV), typically up to 30%. Below are the stages you should follow when looking to buy a repossessed house in the UK:
Gazumping is a term used when a seller accepts an offer from someone, only to later on in the process accept a higher offer from an alternative bidder. It’s a term most commonly referred to during the negotiation period of a property sale, which can result in the original bidder being in a difficult situation.
Gazumping changes the victims situation from believing they have landed their desired property to starting the process back at square one. Not only does it cause annoyance to them, it can also have negative financial implications.
As they have made an agreement with the seller to buy the property, they may have spent money on solicitors to write out contracts, surveyors to look at the property, and possibly stopped pursuing other properties they were interested in. Although frowned upon, gazumping is legal up to when contracts have been exchanged, and is most common in England and Ireland.
For more information on gazumping, see our Knowledge Guide here.
To summarise, there isn’t a definitive period of days, week or months in which a purchase of a repossessed house can be completed. There are clear steps to get to the final offer stage but the possibility of being gazumped mean that the process could take additional weeks or even months to complete. As always, use these steps as a guide and seek professional guidance if needed.
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