Buying a Repossessed House: Ten Top Tips

By November 25, 2009House Repossession

Despite what you may have read in the press or seen on the TV, buying a repossessed property isn’t the simple road to riches that it’s often made out to be.  As with the purchase of any other house, there will be obstacles along the path to completion and it pays to be aware of them.  Here are our top tips for avoiding the pitfalls and skirting the rocks along the way:

  1. Check the property out properly! Just as with any property, the valuation should take into account things like transport links, proximity to local schools, the quality of those schools, local levels of employment, local development proposals.  There are a couple of free sites that will help you in this process: nethouses.com and House Prices.
  2. Speak to a mortgage broker especially if you’re in the market for a new mortgage. London & Country offer free telephone advice.
  3. Don’t go to one of the ‘specialist’ brokers who advertise mortgages for bad credit risks; you’ll just pay through the nose for the same services that other brokers offer.
  4. Learn about the marketing of repossessed properties – like the vendor doesn’t have to take the property off the market even when they’ve accepted an offer!  It pays to be in a position to complete quickly.  This means that:
  5. You should have your finances in place at the outset.
  6. Know what you’re buying, it’s easy to put on the rose-tinted glasses if you’re getting a property below market value.  Don’t! A property is a property and independent surveys are vital – especially with repossessions!  The Royal Institute of Chartered Surveyors (RICS) is the place to to find a local chartered surveyor.
  7. Ensure there are no sitting tenants.  If the property was previously rented out this is a distinct possibility…
  8. Gas, water, electricity and telephone will probably have been switched off, so you will need to arrange for reconnection.  You will probably be charged for reconnection of the phone.
  9. Watch your own credit rating.  A question commonly asked on our forum is what effect living at a repossessed house will have on your own credit rating.  The chances of your records being muddled with those of the previous owners/tenants are slim but it pays to check. Once you’ve been in for a few months, sign up for the Experian Credit Expert report.  They offer a free 30 day trial!
  10. Contact the previous tenant’s creditors as and when the brown envelopes fall through the letter box.  Tell them that the defaulters have moved on and you shouldn’t have to deal with heaps of demand letters or bailiffs turning up at the door.
[youtube]http://www.youtube.com/watch?v=RJE0ezlRIlA[/youtube]

Leave a Reply