Buying a Repossessed Property

Although the legal requirements when buying a repossessed property are basically the same as when buying any other; there are some issues that arise from the fact that the lender has no personal knowledge of the property and that the transfer will be under a power of sale.

You can end up with a bargain, but you need to prepare for the fact that the lender’s solicitors will not be able to answer the vast majority of your enquiries, will expect you to do all the legwork (and bear any associated costs) and will set and stick to tight deadlines.

Raising Enquiries on a Repossessed House

The lender will obviously never have occupied the property and consequently will not be able to answer the usual enquiries that would be raised of an owner-occupier. There could be a Property Information Questionnaire in the Home Information Pack if it was first marketed when this was required, though it may not contain the specific information you are looking for; and in the place of a Property Information Form there will usually be another, much shorter document, which basically points out that you must rely on your own investigations.

Some estate agents such as Fulham letting agent, sell repossessed property on behalf of lenders, so they may be able to help with information regarding the property

There will be certain things, such as planning permissions, NHBC certificates, building control completion certificates that you will need but the lender will often not hold. You may ask the lender’s solicitors to obtain copies however they are under a duty to mitigate costs and will usually advise that you must obtain them at your own expense. Although they may suggest indemnity insurance for certain things, most standard policies will require you to confirm certain things that only a person with past knowledge of the property could confirm, for example in respect of lack of planning permission, that the work that has been done is at least 12 months old. You may therefore need to obtain a bespoke policy, which if it can be obtained at all would be more expensive.

As the seller won’t be able to give you any information about any disputes, it is worth trying to speak to the neighbours to check if there are any issues, such as access or boundary disputes, that you ought to be aware of.

The lender’s tactics when disposing of properties are to do so as quickly and cheaply as possible and limit any liability which it might have following to completion the minimum possible. This can be frustrating for a purchaser but it has to be remembered that they have a duty to the repossessed borrower to act in such a way as to mitigate their loss.

Contracts with Repossessed Homes

Most lenders will have a standard form of contract to which they will not accept any amendments. Some of the clauses may appear (or in fact actually be) unreasonable, however it is not usually worth arguing for amendments, a lender will often prefer to withdraw from the sale then agree to amend the contract. It might be necessary to insist that exchange and completion takes place simultaneously, which will deal with the fact that you will be responsible for the property between exchange and completion and the reluctance by some lender to contract to give vacant possession (because of the possibility of squatters breaking in following exchange). Lenders will usually agree to this, as obviously they won’t have an onward purchase to worry about.

One common amendment made to the standard conditions of sale that you need to be aware of is the number of days, following service of a notice to complete, in which you must complete before the seller’s right to rescind arises. Under the standard conditions this is 10 working days however it is often amended to 5.

Lender’s solicitors will often use the special conditions to disclose any defects that might put you off buying the property. Their client is under a duty to disclose such defects as it is aware of but doesn’t really want you to know about them.

Some of the standard contracts will have over 50 special conditions and although they should, some property conveyancers will fail to read them properly, reasoning that since no amendments will be accepted, there is no point. It is not uncommon therefore to see a condition along the lines of “The Buyer’s attention is drawn to the fact that the owner of the neighbouring property has verbally informed the Seller that he intends to take legal action to challenge the position of the boundary. The Seller has no further information and the Buyer shall not raise any requisitions in this regard”. You must make sure that you read the contract thoroughly before signing.

Deadlines for Exchange and Completion

A deadline will be imposed requiring exchange of contracts to take place by a given date, typically 28 days (if buying with a mortgage) or 14 days (if buying cash) from the date that your offer is accepted. It is important therefore that you have a solicitor already in place before you make the offer so that there is nothing to delay the seller’s solicitors from issuing contract papers.

If you are obtaining a mortgage do all you can in terms of submitting your identification, proof of earnings etc before you offer on a property so as to minimise delay afterwards.

Make sure that you are aware, and you make your solicitor aware, of any deadline and if it is not met, expect that the lender will withdraw from the sale. Having said this, if the property is still available for sale when you are ready to proceed they may be prepared to reinstate the offer.

Lender’s Obligation to Get the Best Price

Ordinarily, once you’ve had an offer accepted on a property it will be taken off the market. However, that will not usually be the case when buying a repossessed property. This is because the lender is obliged to get the best price reasonably achievable and must therefore consider any offers received right to the point of exchange. The possibility of being gazumped at the last minute is a risk you must accept when buying from a lender in possession.

Another effect of the obligation to get the best price is that the lender will have to place a notice in the local press and/or on a property website, such as Rightmove, when an offer is received. This is called the “public notice” and contracts cannot usually be exchanged until a week after the notice is published. It will be entered by the selling agents and should be done immediately, however it is sometimes overlooked and can cause a delay to exchange. Either the lender’s solicitors or the lender’s asset manager will need to be in possession of the notice before exchange takes place.

Service Charge Arrears & Retentions

Under the standard conditions of sale the seller is responsible for all arrears of ground rent and service charges which are outstanding as at the day of completion. Where the amounts are unknown, for example because there will be a balancing service charge covering the period of the seller’s ownership which will not actually be applied to the account until after completion, it is usual for the seller’s solicitor to hold back a portion of the sale proceeds to cover this liability. This is known as a “retention”. A lender will not however agree to hold a retention. This is because it will want to close the mortgage account as soon as the sale completes, and also if it suffers a loss it will need that loss to crystallise (which means the exact amount of loss will need to be known) before it can claim on any insurance policies or pursue a valuer for negligence etc. It may agree to an allowance instead of a retention, which may actually be more advantageous to the buyer.

The contract will usually be drawn so as to remove any liability on the lender for ant arrears of which they were not aware on completion so it’s important to check the position before completion and it’s a good idea to pass any arrears details to the lender’s solicitors. This way they can’t claim they are not liable because they were not aware.

Transfers Under a Power of Sale

Ordinarily a seller would transfer the property using form TR1 and would need to repay all mortgages on the property. A lender however will use form TR2 (transfer under power of sale). This operates jointly as a transfer and as a discharge of the lender’s charge. Also, it means that any interests subsequent interests, such as charges or bankruptcy restrictions registered after the lender’s charge will be automatically removed from the title by Land Registry when the transfer is registered without the need for discharge documents. Any interests which have priority of the lender’s charge will still need to be dealt with in the normal way. Where the lender has more than one charge it is important to check that they are selling under their superior charge (the date of the charge will be specified in the TR2). If they are not they will need to produce a discharge document for their superior charge and any other charges which have priority to the one under which they are selling.

It should be noted that establishing the priority of interests is not always straightforward and you should always therefore seek legal advice when buying a repossessed property with more than one interest registered. If you fail to obtain a discharge document for an interest which is not overreached by the lender’s power of sale you may end up being bound by it which can be extremely costly.

Completion Arrangements

The lender’s solicitors will normally provide their standard replies to requisitions on title with the contract papers at the outset. There will not usually any undertakings to redeem any charges (see above). You should check the location of the keys.

You will often find that the lender’s solicitors will not be able to provide a transfer on completion but rather that the lender will contract to send it on within, say, 7 or 14 days of completion.

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50 Responses to “Buying a Repossessed Property”

  1. Hi Hip-co2sultant this is a really good comprehensive guide to buying a repossessed property and will be of great use to new investors in this market. I will retweet this for others well done.

  2. Thanks Sharon, your feedback is appreciated. We have a series of similar articles planned over the coming weeks which will look at making certain aspects of the property market a bit clearer.

  3. I found this information interesting.

  4. If a house has a seven day public notice on it and I then put a higher bid which is accepted, would I then have to wait a further 28 days (Mortgage) until completion and will it need to be advertised as a public notice with my improved bid?

  5. I assume so yes, because the offer has changed!!!

  6. Great article, most informative

  7. Great job here. I genuinely enjoyed what you had to state.

  8. Great blog. You explain everything very nicely.

  9. Good blog on Repossessed Property. I like it when i come across sites where i can read up on usefull tips regarding repo property. Buying online makes it so much faster.

  10. Most of the time repossessed homes come with with attractive terms like affordable down payments and low interest rates.

  11. Question? i placed a offer of £74500 on a repossessed property,this offer was exceeded by a third party i then placed another offer £78500 which again was gazumped.I then 3 days later offered £79000. I was asked by the estate agent if this was my final offer,to which my reply was i am not prepared to disclose my understanding was by law you have to advertise the highest offer once accepted in the local paper and i would see what it was and act was advertised for £80,000 3 days later in the local paper stating that any offer exceeding this offer had to be submitted within 5 days,i offered 81,000 within the 5 days which was put forward however i was told this offer had been declined and was i prepared to offer more?I again advised them as my offer was exceeded again i would wait until the higher offer was advertised and then decide.
    The house is still advertised on there web site and after 3 weeks i decided to ring them back as the higher offer they had recieved above mine has not been published which i was told by a solicitor was a legal requirment.
    Just been told the house is going through and it is not a legal requirment to publish the higher offer, the house is been sold for 80k which is 1k less than my offer to a cash buyer.I was going to put 50% down and the rest was on a buy to let mortgage which i had a notice of intent from the lender for.
    the question is are the repo company and estate agent in breech of there contract by accepting a lower offer?
    And should the house not of been advertised again in the paper with my high offer of 81k ?
    Any answers very much appreciated ASAP so i can possibly take this further if needed.

  12. Did you view the property?
    I had a higher offer declined than the public notice because the bank thought I hadn’t viewed and therefore would try to reduce the agreed priced afterwards…
    It can be declined even if it is more money for reasons
    only know to the bank holding the debt.
    Ask the agent exactly why it was declined.

  13. This is what happens!!!!!!!
    We have just put the asking price offer in on a repo property…our offer was accepted…..we are waiting anxiously to be gazumped by a cash buyer which is very likely to happen! obviously a quick sale is wanted and they just want back the money that they are owed.
    we would have given 80 k for another repo but they sold it for 76 k to a cash buyer.
    the best thing to do when buying a repo at this point in time is not mess about, go straight in at the asking price and hurry it all up asap.the further down the line you are the more chance you will get it and other parties will be put off viewing it by the estate agents. cross yer fingers and hope for the best. i wouldnt play the game and go in lower then have a bidding war….not my style atall….best thing really is to snap it up with cash.

  14. We have toyed with the idea of buying repo but, having read your very informative piece on doing this, we are a little sceptical – possibly a little green around the gills on the pros and cons of it all!
    Can relate very well to how John feels. Really scared to get in a bidding war or, worse still, get gazumped right at the last stage.
    We would also have a 50% Deposit: feel scared that we’d lose some of this wasting money on Solicitors etc without anything coming at the end of it 🙁
    Has anyone any information re: buying a Repo that is owned by a Trust?? Estate Agent has given us scant info, namely that its different from buying a repo mortgaged by a Bank. Also stated that once our offer had been accepted, the property would be taken off the Market, and also that they may be a little more flexible with the Completion/Exchange period as they wouldn’t want to lose their buyer. Sounds too good to be true huh?
    Can anyone shed some light on this type of purchase for us.
    Ta to John and Luke (7 July and 22 July above): lots of food for thought for us!

  15. If I am a cash buyer and want to make an offer on a repo property which already has an offer on it. If my offer is lower than the current offer but I am cashed up and ready to go and can close with in 4 to 6 weeks will this be more favourable than the current offer which requires a mortgage.

  16. We bought a repossessed bar /restaurant so no previous info available. It has a licence. It also had obvious working electricity and water. However when we investigated to have the power turned on it appears that there are no meters for water or electricity. The mains water was installed to the building after the repossession (it ran off a water deposit previously)so it requires connection (€900 for meter + plumbing installation costs). The electricity meter had been removed so we now have to pay for a new installation which involves digging up the road. Costs so far for this excluding full interior rewiring are currently estimated at a minimum of €4000. We feel hard done by here and wonder if the bank have some form of legal obligation to inform us that these basic utilities were not available to us. We are with CAM bank. We have been treated very shabbily by them right down to them not providing keys when we signed. We had to wait 3-4 days when they were next in town to deliver it or drive to their offices an hours distance to pick up 1 key (there are 8 doors in this property) and we had to have all new locks at another expense of €600. They insist that you take out mortgage protection with them, and the quote they provided was double anybody else’s. We are fighting this with them at the moment. They do not give 100% mortgages despite what they say on their boards – certainly for commercial properties.

  17. whoops – sorry – just realised you are a uk based company. I found you on google search – I did include ‘costa blanca’ in my search. So, I guess I won’t be getting a reply. But nice blog anyway – I wish I could find something similar here in Spain!.

  18. Greg: First Time Buyer Says:

    Hey guys,

    Me and my brother are finally getting the cash together to buy a house (we’re only 23 and 24), we have been authorised by our financial advisor to go ahead and start viewing properties etc as we’ve been approved a mortgage up to £150,000 with a 10% deposit of £15,000. So we can afford to buy a “normal” house that isn’t repo’d BUT there is one going in our area for £118,000 (advertised price), we are seriously considering this property. I am going to be contacting the estate agents in the morning to ask the nitty gritty tommorow on the phone and wrestle any loopholes hidden fee’s etc without the distraction of a fake smile. What would be a good starting offer for this property? Also with all our proof of earnings etc all standing by with the financial advisor and mortgage companies ready to take us does that improve our chances? We are also going to be living there and improving the house as time goes by etc Will the bank favour this too cash investors looking to earn cash of the property? We’ve set ourselves a limit of £130,000 on this house as it would not be cost effective after this price. Also with the 28 day completion period – is there any way some hotshot investor can muscle in on our sale after the 7 day notice in the local paper/internet site? Sorry for all the questions but a lot of these guides are very brief and different people are saying different things and it’s getting tedious trawling through the useless sites that have really no information at all!! Sorry for the questions guys just wondering if there are any experienced buyers that could lend some tips the negative and the positive are all good!!! Cheers!!

  19. […] Comments Greg: First Time Buyer on Buying a Repossessed PropertyTim on Property Professionals – Open letter to Barclays Partner Financeproperty agents london […]

  20. There are certain complications in purchase of repossessed property. You’ve shared some very useful tips.

  21. We were due to complete on our purchase of a repossession property last friday – this was within the 28 day period. monies were transferred and we were expecting to collect the keys. We now discover, five days later – and outside of the 28 day period that the agent/bank selling the property has “lost” the file relating to the property and cannot complete because they cannot work out what is owed/the finances etc. Where does this leave us? Any advice please?

  22. Question I was trying to buy a reposession house which was put on the market 2 weeks ago today. I have been putting offers on it but they were rejected. I was told that by law the property would go in the paper today with the highest price that had been offered on it so I would then be able to see what price I am actually bidding against.I saw the price of 58,500 on find a this morning. So at 6am I emailed to offer 59,000 the estate agent said the offer was rejected as contracts have exchanged how can this happen I really wanted that property near to my parents. It all sounds very clopak & dagger to me. Could you
    please offer any advice is there anything that can be done the creditors are AMG in Newcastle.

  23. Ok I was accepted for an offer on a repo and was 2weeks in. Some one has made a slightly bigger offer on the property, I am prepared to match or beet this offer, but does that mean I must start again on my morgage application? Or can I just amend 2weeks in?? Please can some one give me some advise ASAP as they are awaiting my answer before they sumit new offer!!

  24. You keep referring to the Lender when I think you mean vendor.

  25. Hi I have put an offer in for a repo property that I though the bank would own 100% but it turns out they only own 25% and the other 75% is owned by the housing association. Now the housing association has given the bank the right to staircase the 75% and sell on contract at 100%. It could take up to 12 months for the bank to staircase to 100%. I’m just worried on the rights I have during this 12 month period, do I actually own 100% of the property? The contract includes a Draft Transfer form TR2, Property title, Lessor title and Leasehold info. Is this enough to securely own the propery?


  26. I have been recently buying a repo. It was on for 50,000 I bid 47,000 and it was excepted. This was over 2 months Ago. I have had a real problem with what’s called a improvment notice. And the lender took there time to agree the new terms to my morgage.

    We have been out bided twice in this period, once at 47,500 and another at 50,000. For a two weeks it stayed at 47,000 but was never publicly advertised. I got a phone call explaining we had been out bided and so We agreed to the new price of 47,500 and it stayed there for around a month, while the sorted the improvment notice out.

    Through this period they have publicly advertised the propriety. Then I was informed if they lender dosent hurry up I would lose it as there was a new bid at 50,000, I was given to the end of the month as I was half way through the morgage approval. He the. Informed me he would take the higher bidder at that time The estate agent then asked me if I was required to will I go higher to 50,000 I said no. It’s now past his deadline and there is no sign of the other bidder…. I am sure that there is no sign of the high bidder because I informed him I wouldn’t go higher.

    My point is DONT TRUST ANY ESTATE AGENTS. There is laws for all this but for what ever reason they seem to make there own…. I just wonder if I will ever get this house, and my question is how long after I own the propertie is it until I can sell it tAx free?? I am a new buyer.

  27. I purchased a repos apartment, the offer is accept but we are in a stand still as the vendors solicitor have very limit knowledge to the property and unable to response to the inquiries necessary to complete the mortgage application.

    Did anyone have similar experience on how to resolve this? thanks

  28. Am in a process of buying a repossesstion property. The exchange of contract has been delayed as the solicitor we appointed is less than competent. The deposit money was in their account prior to date agreed for the exchange of contract and they send us ‘deed of convenant’ 2 days after that for us to approve it.
    Some of the clauses in the deed are completely in favour of the seller or repossession company. Our solicitor is unable to advise us what are things we should be looking for to protect our interest.
    As mentioned in your article, if these clauses are unreasonable should we be really going forward?
    The property in question is an a flat build around 6 years back, so should fall under NHBC gurantee.

  29. how long does it take for a repossessed house to be sold, do the repossession company have a time scale in which the house has to be sold by? many thanks.

  30. What happens if the 28 days exchange are not being met by the seller? What are the buyer’s rights?

  31. I bought a repossession property last year . I paid to my solicitors all the search fees but when i collected the keys from the estate agent and i thought i will get all the paper work for the house from my solicitor but i was shocked to hear that there’s no paper available for the property ,only my name was registered on the land registry.
    Do you think it will be problem if i sell the property in the future.
    Why do i have to pay my solicitor all the fees for search when i could not any documents.
    I have been told by the solicitor that the owner took all the papers.
    Please help

  32. This is a great post for what to do leading up to exchange. I wouldn’t worry too much about the 28 day exchange “policy” most will not strictly enforce this if they can see signs of things happening in the background.

  33. Very interesting and well explained. Thank you!

  34. We are in the process of purchasing a property and we are having trouble with it. We are feeling to be left a bit alone, despite of having a solicitor who is looking (or supposed to look after) our purchase.
    We are purchasing a flat, which is being sold by joint administrative receivers of the repossessed company. The repossessed company is the owner of a leasehold and freehold of both flats in the building.
    In the lease draft received from the seller solicitor, we are finding that the responsibility for the insurance, maintenance and repair of the common services is being left to the landlord but there is no management company, and the freeholder/landlord is already in administrative receivership. Given that, if the company will be struck off the register there will be practically no one liable to the tenant for these common services.
    The seller’s solicitor responds to that as follows:
    “In relation to the freehold reversion, this will be dealt with when both flats have been sold; (…)”
    Our question is – Is that legal? Do they have the right to do it that way? – in that order?
    It is of course mentioned that the leaseholders will have the opportunity to purchase the freehold pursuant to the provisions of the Landlord and Tenant Act 1987. However, I cannot imagine we can sign that leasehold contract under these circumstances. It is our big concern for the property now and for its supposed sale in the future.
    I’d like to mention that the other flat is being currently sold at an auction as ‘a Leasehold Self-Contained First Floor Flat subject to a Regulated Tenancy’ and we are aware of what’s the legal state of it.

    Is this unusual or is this a common situation with repossessed properties? Has anyone got any experience on that?

  35. Excellent article, thanks. I have been using it in the last two weeks.
    I just had an offer accepted 🙂 for a repo leasehold apartment.
    I’ve done my own conveyancing in the past, but wouldn’t do it on a repo.
    To address some of the points above:
    – You don’t always have to offer at asking price. I went in very low and my first offer was accepted.
    – The process can be varied slightly by the lender (vendor) but generally is like mine:
    — You make an offer, which must be accompanied by financial proof. Bank statements if you are a cash buyer, mortgage details if you aren’t. Get ready before you offer.
    — You will be told whether your offer has been accepted, eventually, but may have to wait some days until the lender’s weekly? meeting on offers comes up. If you find yourself waiting long, a higher offer may be under consideration, but you won’t be told that. Hang in there – in my case, that offer dropped out, leaving me in the lead.
    —The vendor’s repo agent publishes notice on the websites of the estate agent and a general property agent such as Rightmove. If you are lucky, they won’t saturate the market with notices. Helps if they believe in you as a buyer.
    — The lender can then issue a contract to the buyer, but not within 24 hours of notice being published, and with the contract you may see the lease for the first time.
    — It may be called a seven-day notice, but it will remain until the buyer exchanges contracts, so that further offers will be considered until the last moment.
    — The first bidder (excluding dropouts) remains in a privileged position. At any time a higher offer may come in and must be considered on the same terms – with financial proof. If good, the first bidder will be informed what the offer is and by matching it can regain the lead. The second bidder will be informed that his offer is no longer enough, but will not be told how much the first bidder is offering. This can repeat. At any time, the first bidder has only to match to win. Remember, the process may not be exactly the same with every lender, but you can ask the lender’s agent (repo company) what their process is.
    — Notice of the higher offer will be published and this will repeat until exchange. Each notice may be valid for a day, a fortnight – depends on the action.
    — Lenders are duty bound to get the best result, but they don’t have to accept a higher offer and if so they don’t have to give a reason. They want a safe transaction and you should make sure you look financially sound, untroublesome, and keen to complete quickly.
    — If you are inactive they will probably apply the 14/28 day rule and exclude you, if there’s competition. If it’s slow and it’s their fault, they probably won’t. If you run a day or two over the limit and you are obviously nearly there, they won’t dump a good transaction unless there’s another reason.
    – You will need a solicitor experienced in repos – if the repo company suggests one that they work with and you are happy when you talk to them, say yes. They all charge much the same anyway. Good communications channels are far more important.
    – Decide whether you need a survey. Of course you do for a freehold house, but a leasehold apartment is a different bet. Ask your solicitor.
    – Searches are likely to be the biggest delayers. Local authority searches take around 14 days. They are essential for a house, but think carefully about whether you can omit them in the case of a leasehold apartment. If the block is a few years old, then the main facts that searches would uncover will already have been uncovered by the other apartment owners and probably resolved. If it’s an older or converted block, searches could be more important. If you decide to do without, or if you really haven’t time without losing the purchase, ask your solicitor about taking out a ‘no search indemnity policy’ for a one-off fee, maybe £60, to cover future losses you may incur by not searching. That’s cheaper than searches, incidentally. Make sure you aren’t charged for both.
    – Your solicitor can only do so much – it’s your purchase. Take responsibility for scouring and really understanding the lease and the contract. Make sure you don’t inherit costs, eg unpaid service/management charges from the (probably bankrupt) former inhabitant – your contract should exclude these. Make local enquiries, visit at different times of day, pick up any potential problems.
    – The whole transaction is less informative, less satisfactory, more risky than a non-repo purchase. The good deal you are getting should make up for that.
    – As with any property purchase, think about insurance and squat-prevention between exchange of contracts and moving in (which may be at or after completion).
    — Be available at all times and expect a high-octane ride.
    Good luck – to you and wish me luck too!

  36. PS: One more thing: you can get solicitors who work on a non-sale no-fee basis. Saves you wasting money if you get gazumped. Mine didn’t charge any extra for this guarantee, in fact it was the best solicitor’s quote I had.

  37. Hello, a friend of mine is due in court Monday and could possibly have her house taken off her. Is it possible at such short notice to secure a buyer for the debt owed to the bank or even tenants who will pay the mortgage and any arrears directly.

    I do not know anymore details about the court hearing I am afraid but I was interested in renting her house until I heard that she was due in court.

    Can you offer any help or advice on such limited information?

    Kind regards.

  38. Hello my partner and i have recently put in an offer on a repossesion – the property was 1 day before exchange and we got out bid!! We have not heard back from the agents nor have they changed the price on the website? I understand the agents have no obligations towards us but we have lost money on fees. Any comments?

  39. That is a great tip especially to those fresh to the blogosphere.
    Short but very precise info… Thank you for sharing this one.

    A must read post!

  40. Hello, I have just got back on the property market and bought a repossesion consisting of a 2 bedroom flat in Scotland for £60,000.I paid cash and plan to live in this property. I had previously lived in the same block of flats about 10 years ago so didnt carry out any title searches as had done so on my previous flat and had no issues.

    I was however not advised by my solicter ( who knew I had bought the flat at an auction, the previous tenenant was backrupt and that this was a repossession) that this would potentially leave me liable for any costs associated with the previous tenant.I have lots of work to do in the flat and am currently putting in bathroom,kitchen, heating etc but was shocked yesterday to receive a letter from the factor stating that I am liable for £5,800 for unpaid factoring fees from the previous tenant. My solicitor never warned me of this or that insurances were available to protect me from potential claims. What do you recommend as I do not have the money to pay this ? Thanks Lorraine

  41. I was looking at some of your blog posts on this website and I conceive this site is really instructive!

  42. I am buying a repo and are waiting on the other side to answer the final enquiry before exchange re the freehold .. However the freeholder was the other person bidding against me for the flat and now they are trying to defur the sale by not answering my question… The repo company are now trying to withdraw because we won’t exchange until we no the answer , is there anyway If I loose this property I can be compensated as this has not been in my hands ?

    And the freeholders purposely doing this ?

  43. Hi there,

    Thanks for the very informative website.

    I wonder if someone can assist with answering a query.

    We attempted to purchase a property in April 2012 for £150,000 but on the day of exchange the purchase fell through as the (divorcing) couple who were selling the property revealed that they has a second charge on the property that they had insufficient funds to clear.

    Some 6 months later, we understand that the property has been repossessed and has just been assigned to a local Estate Agent. I have spoken to the Agent and was told that they are awaiting 2 independent valuations before placing the property on the market.

    We still wish to purchase the property and wonder if there is anything to give us a better chance of acquiring the property when it comes up for sale again.

    Could we, for example, instruct our solicitors to proceed with preparation for exchange of contracts, even though we have not yet bid on the property?

    We are cash buyers and am assuming that our solicitor still has paperwork from the previous aborted sale. I’m assuming that some/all of this will need to be redone in view of (a) elapsed timescales and (b) change of vendor.

    Any guidance must appreciated.

    Thanks in advance.


  44. Have you ever considered publishing an e-book or guest
    authoring on other websites? I have a blog based upon on the same ideas you discuss and would
    really like to have you share some stories/information.
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  45. We have bought a house that was repossessed and everything is ib place exept now we are waiting on some document to come from the receivers, before we can get our date for moving. Any ideas on how long this could take

  46. Buying a repossessed properties is very much hard to identify for the individuals it can be done by an property expert, solicitor.

  47. michael mc laughlin Says:

    I am considering buying a repo property but had read that the buyer mite be responsible for any VAT ? or tax owed by previous owner particularly if they had a no. of houses.
    Is this true and is it likely that HMRC would look to recover any VAT from me?for a 40000 purchase price is there a maximum liability?
    many thanks any other advice?

  48. Put an offer in for a repossed 2nd floor flat , it full of a past tenants bin bags clothes , sofas , beds everything . Is it the repossession companies legal obligation to dispose of these items or mine when I sign contracts would be grateful of your advice please

  49. who can i contact to buy repo properties

  50. Hello,

    Thank you for this article.

    Wondering if I can get some advice.My husband and I recently completed on a repossed property. We had a BICS report and no major issues were flagged but obviously utility checks couldn’t take place.The property had also been sat unoccupied for 12-16 months.

    Once in and utilities connected we had no hot water and the water tank wasn’t filling properly. Called a plumber who said we will need to have several parts replaced due to “lack of care”. All, I appreciate, part of the risk when buying a repo.

    Problem is there is an actual leak and after meeting the neighbours, he said they had the leak when the last occupants were in so were more than aware of it.

    My question is that does the bank/Asset Management have an obligation to notify us of any issues they are aware of before purchase?

    Many thanks in advance.

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