Posts Tagged ‘repossessed property’

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Repossessed Homes: House Prices to Recover Slowly

Monday, August 3rd, 2009



House prices in England will fall this year and next before recovering, the National Housing Federation forecasts.

It expects prices to fall 12.2% in 2009 and 4.6% next year, before stabilising in 2011 with a 1.1% rise and continuing to climb in the following years.

It predicts that, by 2014, house prices will be 20% higher than current values.

But the group, which represents housing associations, said English homeowners who bought at the market peak could be in negative equity for five years.

Although five-year forecasts can be unreliable, the group said that not enough homes were being built.

Price predictions

The group has suggested that house prices would fall sharply this year. This was in stark contrast to the view of the Nationwide Building Society which this week said there was a “reasonable chance” that prices in the UK could end the year higher than they started 2009.

The reversal in 2011 would accelerate in 2012 with a 7.5% increase in prices, the NHF said, followed by rises of 8.4% in 2013 and 6.8% in 2014.

That would mean that English homeowners who bought at the height of the property boom would be in negative equity until 2014.

“Our research shows that, while house prices are falling in the short term, they will inevitably increase in the long term because of a fundamental under-supply of housing,” said NHF chief executive David Orr.

Only 60% of new homes required to be built each year were being constructed, the NHF said.

The group said that many young and lower-income people would remain locked out of the housing market until restrictions on lending by mortgage suppliers eased.

Visit the BBC site to read the full article.

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REDC Repossessed Homes Auction

Monday, August 3rd, 2009



It’s fast, furious and could be the future of property buying. Hundreds of houses went under the hammer in the region’s first property auction dedicated to selling repossessed homes and repossession properties.

Prospective buyers were hoping to pick up a bargain during bidding and hopefully turn their house into a home. Plush semi-detached homes which could have been expected to sell at £120,000 were sold at a fraction of their value.

The auction was being run by American organisation, REDC (Real Estate Disposition Corporation). Most properties are selling for around half the price at which they’ve been valued and advertised by estate agents for the last six months. A top table of lenders sits just below the auctioneer, giving each final bid the thumbs up or down.

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How To Avoid Property Repossession

Sunday, July 19th, 2009



I found a great article from Wiki How on Avoiding Property Repossession:

Repossessions are starting to become common. Last year 17,000 homes were repossessed, the highest number for five years, with further rises predicted for the coming year by the Council of Mortgage Lenders.

A rise in property repossessions means that bailiffs will be kept busy – so what can you do to stop the bailiffs coming to your house uninvited? This will depend on how bad your situation is, but even if you have been handed a court order, and proceedings for repossession of your home have been started, there are still ways that you can deal with the situation.
If you are, or someone you know is facing repossessions, this article will help to enlighten you with the options that you have.

Steps

1. Falling behind on payments
(A) Lenders will normally only start to take action if you miss payments for two months – if you are having difficulties, the best thing to do is let your lender know and see if you can come to an arrangement with them.
(B) If you fail to come to an arrangement with your mortgage lender, they are most likely to send you a letter from their solicitor demanding payment, before issuing repossession proceedings with the county court.

2. Repossession proceedings
(A) By attending the proceedings, you may be able to come to some arrangement with the court and your lender. However, if you do not attend, the court will have no alternative but to order repossession.
(B) If you can make an offer to keep paying your monthly installments, plus something towards the arrears, the judge may be satisfied with this, and grant a Suspended Order For Possession.

3. Bailiffs
(A)If you have made no acceptable offer for repayment, or defaulted on a Suspended Possession Order, then your lender has the right to seek repossession of your property. In this situation, a court order will be granted, and a date will be set for a court bailiff to visit your property to formally take possession. You will normally be given just 10 minutes to pack your things and get out.

At any point in the process, before the bailiffs arrive, you still have a number of options to solve the problem. These are:

*Negotiate repayment – If you can afford to pay make your normal monthly mortgage installments and pay something towards the arrears, the lender may be able to agree to this.

*Pay off all of the arrears – Your options here are to borrow money from friends or family, or from another lender. It is important to be careful here though, if you can’t afford the payments on a new loan, you may have more lenders chasing you for money.

*Remortgage – Some mortgage companies may be willing to remortgage if your house is worth more then your outstanding debts.

*Sell your property – You could do this through an estate agent, which would probably get you the best price for your house, though there are downsides – it could take many months to find a buyer and complete a sale, and you may even need to spend money on your house to attract buyers, also bear in mind many buyers pull out due to broken chains.

*Sell your property fast – A fast cash buyer will normally offer you between 80% and 85% of the market value of your property, but they will give you a fast sale, completing the exchange of contracts in a very short time frame.
If you are facing a repossession order, this could be the answer. In addition you can sell and rent back your property, avoiding the hassle and stress of finding somewhere else to live.

Tips

* You can possibly sell and rent back – this is a great way of no one ever finding out that you sold your house.

Read the full article here.

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Repossessed Homes UK: £50 Council Handout To Ease Recession Pain

Thursday, July 9th, 2009



Manchester City Council are to investigate the idea of paying homeowners’ “cashback” in an attempt to help them through the credit crunch and ultimately avoid repossession. Each household could be given £50 each to help through the recession. Many people in the UK are currently stuggling with mortgage repayments and with tnis extra money coupled with other government initiatives to help people with repossessed homes, this could ultimately help in stopping their home from being repossessed at a time when every penny counts.

This decision has come as local authorities throughout the UK are drawing up measures to stop unemployment soaring and stop businesses from going under.

This “cashback” initiative would mean that every household in the city would receive a cheque or get a one month reduction in council tax bills. The scheme was initially proposed by the Lib Dems and subsequently, the Labour government agreed to investigate the idea further. A report into the feasibility and cost-effectiveness will be drawn up next week.

A similar scheme was tested in London, but proved to be too expensive, and with 200,000 households in Manchester, the total amount of cashback paid could be £10 million. Would it not be better to spend this amount on a project which would benefit the whole community.

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Repossessed Homes Legal Advice Fund Doubled

Monday, July 6th, 2009



With so many property repossessions occurring in UK, the Government is providing extra funding for free legal advice at courts. The fund which currently stands at £750,000 has been doubled to £1.5 million.

This means that all courts in England now provide free legal advice for people who attend repossession hearings in court. Legal services previously funded the repossessed homes desks at court, but this injection of government money has helped double the number of desks in English crown courts.

The government claim that in that four out of five cases these desks help stop immediate repossession or avoid evictions, and that even at this late stage in the repossession process there is hope that a person can avoid losing their home.

This extra funding comes amid recent figures showing huge increases in the numbers of people whose properties were repossessed in the first quarter of 2009. The Council Of Mortgage Lenders (CML) have also released figures which illustrate a 50% increase in repossession levels in the same period.

The announcement comes as the Financial Services Authority is expected to publish figures showing an increase in the number of people who had their homes repossessed during the first quarter of the year. The CML have stated that a record 75,000 homes have been repossessed already this year.

The UK government have introduced a new range of schemes in order to aid people and help avoid home repossession. This includes the Homeowner Mortgage Support Scheme which allows people to defer 70% of their interest payments for up to 2 years. Another scheme, the Pre-Action Protocol restricts courts from only issuing repossession orders when there is no other alternative.  However, figures show that only 2 homeowners have actually benefitted from this initiative.

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Top Tips For Buying Repossessed Homes At Auction

Saturday, June 27th, 2009



Currently, repossession properties make up 20% of all homes sold at auction. This figure is constantly rising due to the financial crisis in the UK. Banks and lenders are now moving even more quickly when it comes to repossessed houses and are looking to sell them on their first day listed at auction. What does this mean for potential buyers? low prices. The banks and lenders will be willing to sell low in order to force a quick sale and recoup funds.

Property auctions are the best place to buy repossessed homes, but it’s important to know what you are doing and not end up paying over the odds. Below we have added some quick tips to Repossessed Homes UK so that you can hopefully pick up a bargain repossessed property.

1. Do Research
- Make sure you know the area you are buying in.
- If buying to let then know the rental market.
- If the area has Universities or hospitals nearby then finding tenants will be easier.
- Check the market rate in the area especially on the same street.

2. Auction Trial Run
- Visit Property Auctions as a test and familiarise yourself with the process.
- Watch how others bid.
- Obtain Auction Catalogues from auctioneers.
- If interested in a particular property see if there are other documents available from the auctioneers.

3. Visit The Property
- Make a visit to the property, don’t just rely on catalogue descriptions.
- Take a builder with you if possible to get an idea of how much renovations may cost.

4. Pay for a Survey
- Surveys are essential and can ultimately save you thousands if it means you avoid buying a dud property.

5. Have a Price Limit and Stick to It
- When attending auction, have a maximum bid price in your head for a particular property and STICK TO IT. It’s easy to get carried away in auctions with other bidders present but it can ultimately prove costly.

6. Arrange a Mortgage Before The Auction
- Don’t bid on a repossession property unless you are sure you can get a mortgage.
- Exchanges are done on the day of property auctions.
- You will need to complete within 20 days.
- Never apply for a mortgage after you buy at auction, if your application is rejected you risk losing your deposit.

7. Make Sure Your Deposit is ready
- Make sure you have the 10% ready to put down as deposit on your repossessed property.
- Take chequebook and identification to the auction.

8. Factor in all Costs
Remember that there will be many costs involved and don’t forget to budget accordingly.
- Survey Fees
- Deposit
- Auction Fees
- Stamp Duty
- Solicitor’s Fees
- Renovation Costs for the repossessed house
- Insurance Costs
- Future Mortgage Payments
- Other Costs

9. Calculate Taxes You May Need to Pay in the Future

10. Cover your Mortgage Payments
- If buying to rent the property out, it is not certain that you will get a tenant on the first day, or if there is renovation you will have to wait for a tenant. During this time the mortgage will still need to be paid so factor this in also. We advise to have at least 3 months payments in reserve.

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Sharp Increase in Repossessed Homes at Auction

Sunday, May 31st, 2009



With the number of people facing financial difficulty on the rise, coupled with the state of the UK economy, the number of repossessed homes sold at property auctions has increased sharply. Properties are being snapped up way below the market price, with some auctioneers claiming to offer repossession properties up to 40% below the normal selling price.

Leading UK property auctioneers, Allsop claim there is a notable increase in the number of properties being auctioned. Allsop state that the number of properties offered at auction has increased in 2008 whilst the overall price has reduced dramatically, a sign that sellers are looking for quick sales.

Allsop state that around 80% of auctioned properties in 2008 were repossession properties. This large figure has since fallen. This fall is mainly due to government action taken on mortgage lenders to reduce the level of repossession and look for ways to avoid repossession. However, Allsop expect the figures to increase again and more homes to be repossessed over 2009.

Allsop also predict that the number of repossessed homes will not fall for some time and the main source for these repossession houses will be the property auctions. They predict this year will be quiet for the retail property sector but cash buyers will always be looking to pick up bargain repossessed homes.

Allsop suggest that poeple often go to auctions to buy cheap properties and they often leave after finding exactly the repossessed home they were looking for at a bargain price.

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Almost 1,000 Homes Repossessed Every Week

Sunday, May 24th, 2009



The Telegraph newspaper releases new figures stating that there are almost 1,000 homes being repossessed on a weekly basis in the UK.  The Council of Mortgage Lenders claim that their predictions of 75,000 homes being repossessed his year may be less than in reality. They claim that the government will be introducing new measures in order to help prevent repossession for homeowners.

Economists on the other hand are less optimistic. They claim that with unemployment figures rising on a daily basis, the number of people struggling to make mortgage repayments will also be increasing and record numbers will be losing their homes.

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Buying A Repossessed Home At Auction Q&A

Thursday, May 14th, 2009



Below are some common questions for property auctions:

Why Should I Buy At Property Auction?
There are numerous reasons for buying at property repossession auctions. All sellers at auction are motivated to sell and want to sell quickly. This often means that they are willing to sell their property at a low price. Often the residential properties will renovation work carrying out which means there is an opportunity for the buyer to make some money and also increase the value of their property. Also once the hammer falls at a property auction there is no chance of going back on a deal so there is a certainty of purchase.

Are there fewer costs in buying through auction or buying through an agent?
In both cases the fees tend to be similar, there will be legal fees and surveyors fees to payas well as any fees to pay in order to arrange finance. When buying at auction you will need to pay an administration fee to the auctioneers which typically falls between £175 and £300 plus VAT.

What type of houses are sold at auction?
The type of properties sold at auction are repossessed properties which have been repossessed by the bank or mortgage company. As a result the properties may be unmodernised or in need of work. These properties are often different to houses sold at normal estate agents as they may not be immediately ready to move into.

What are the risks of buying at auction?
The risks of buying at auction are similar to those of buying through estate agents. It is important to make sure that u have done all of your preparatory work on the repossessed property such as legal searches, checking the title and surveying the property to make sure there are no defects. The important thing to remember is that once the auction is over the deal must be followed through and you are not able to go back to the seller afterwards should any problem arise. There are no guarantees on the purchase and you must buy it as it is.

How do I find a bargain at auction?
The key to finding a bargain repossessed home at auction is to have the maximum number of options available to you. You should search auction sites on the internet and contact auction houses directly. Bargains are often properties which are not so popular, so looking for a property with defects or one which needs work can be a great option. However, its important to have the know how or ability to deal with defects so that it turns out to be a bargain and not an expensive bargain! When buying at auction, many buyers often leave with ownership of their property at a price much lower than what they were prepared to pay and in case this automatically becomes a bargain.

How can I identify repossessed homes at auction?
There are several things to look out for when identifying a repossessed home at an auction. Check the auctioneers catalogue. In some cases it will say “by order of the mortgagees”, in other cases it may actually say who is selling the repossession property for example a bank, so the catalogue will say “by order of HSBC”. In other times it will say “by order of the receiver”. These are all ways of picking up a property repossession home at auction. However, not all properties will have this information in the catalogue. If you suspect the property is a repossessed home, the easiest thing to do is phone up the seller’s solicitor and ask them who is the seller.

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Why Auctions Are A Good Place To Buy Repossessed Homes

Wednesday, May 13th, 2009



In the UK, auctions are an excellent place to buy repossessed homes. As soon as the hammer falls the purchase becomes legally binding and an immediate payment of 10% will be required to be paid to the seller’s solicitors. Mortgage companies want to recover losses after home repossession so auctions become an excellent way to sell a property quickly and recover their losses.

For a buyer of a repossessed home, a property auction can be one of the best ways of purchasing a repossession property at a price way below market value. It must also be made clear that the buyer cannot renegotiate a price after the auction is over. Often inexperienced buyers commit to paying over the odds and only find out after a valuation or worse still, a poor survey illustrates some serious problems with the property.

All auction experts advise carrying out full research into a property. They also advise having a maximum bid in your mind on repossession properties and this bid should not be exceeded. A property auction can also be a smooth way of making a purchase, a typical property auction will have 6 or 7 weeks of marketing prior to the event and completion within 4 weeks after the auction. This reduces the chances of delays due to issues of finance, answers to complicated legal enquiries or any other slowdowns. Delays are often common in normal property deals but here properties can be sold and bought in a short space of time.

Repossession auctions can often be extremely competitive and prices often rise over the guide price, so its important not to get carried away in bidding. Experienced auctioneers advise looking out for quieter auctions, if no bids are made on a property it is possible to approach the auctioneers at the end and make a low bid which can be accepted.

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