Auction Finance maybe suitable for property investors or experienced landlords that keep a close eye on the property market and wish to retain the flexibility to purchase a property as and when they find a property that meets their criteria and is available at a price Below Market Value (or BMV).
Moving quickly to make that essential purchase has its benefits in terms of picking up a bargain, but many landlords will rely on funding that purchase through finance and such deals are not always able to be guaranteed to be completed in time.
If you bid for a property at auction its vital that you have the finance lined up with a lender. If you win a property at auction you will have to exchange contracts more or less straight away, you cannot legally pull out, therefore it is normal to get a survey of the property done before bidding – or at least to have an expert look at it to see if there are any fundamental problems that could later become problematic. You cannot legally pull out therefore it is normal to get a survey of the property done before bidding, or at least to have an expert look at it to see if there are any fundamental problems that could make raising finance on it problematic.
Most investors will have short term auction finance, a form of Bridging Finance or other short term lending solution, to act as a backstop in the event that the mortgage does not come through in time or in the event that their personal cash position is not able to cover the obligation. Any additional expense is more than accounted for thanks to the savings made in making the BMV transaction itself.
Whilst it pays to plan in advance on these issues and have the finance in place before the auction, it is also possible to make these arrangements quickly. Whether it is a quick solution you need or you wish to put in a safety net, Brilliant Money is in the ideal market position to help thanks to our relationships, expertise and access to restricted or exclusive products, lenders and funding lines.