Bidding at an auction can be an overwhelming thought if you have not purchased property in this way before. So we thought we would help out by setting out a few keys steps to take before the auction gets under way.
KEY TAKE OUTS:
- Follow our step by step process before you start to bid at an auction!
STEP ONE: Pre-Approval
Speak to Mortgage Broker or Bank to obtain pre-approval.
STEP TWO: What happens at an auction?
Attend other auctions to see how an auction is run – so it is less daunting on the day.
STEP THREE: The Right Property
Find a Property you are interested in and attend the open home – ask the agent for a copy of the Bidder’s Guide.
STEP FOUR: Get the Contract
Request a copy of the Contract for Sale and send it to your Licensed Conveyancer for review.
STEP FIVE: Negotiating
Similar to a private treaty purchase you have the opportunity to negotiate the Contract. The weeks leading up to the auction is when this must occur.
If the Contract was successfully negotiated, then your Licensed Conveyancer should give you a copy of the requests and the vendor’s solicitors response to take with you for reference.
STEP SIX: Inspect the Building
Arrange a Pest and Building Inspection, while this cost is not refundable is you are not successful at auction it is a small price to pay for peace of mind if you are the new owner of the Property.
STEP SEVEN: Deposit
Arrange your deposit to ensure you are prepared if you are successful. Your options are:
- 10% cash deposit (unless a lesser deposit has been previously negotiated);
- Deposit Bond. A deposit bond can be obtained through your mortgage broker. When related to an auction purchase a deposit bond cover you for 10% of your maximum intended bid. If you intend to use a deposit bond you need to ensure your Licensed Conveyancer has received approval for this from the vendor’s solicitor.
STEP EIGHT: Time to make a move
Register to bid by contacting the agent prior to the auction.
STEP NINE: Ready Set Bid
Make the highest bid!
STEP TEN: Make it yours
Now is the time you sign the Contract for Sale and plan to pay the deposit.
Congratulations! You are well on your way to becoming a new home owner. Coutts’ look forward to guiding you through the rest of the process and seeing you move into your dream home.
This blog is merely general and non-specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever to this blog, including all or any reliance on this blog or use or application of this blog by you.