When it comes to property auctions, one thing you must pay close attention to is the legal pack. If you don’t know what you are signing up for then you might be in for a nasty surprise which could come in the form of additional costs, a shorter completion period or a whole host of other things.
Property Expert Series: Andy Thompson From SDL Auctions
- Part 1: Introducing Andy Thompson from SDL Auctions
- Part 2: What Steps Should I Take Before I Buy A Property At Auction?
- Part 3: How Do Property Auctions Work?
- Part 4: What Is A Reserve Price?
- Part 5: What Exactly Is In The Legal Pack?
- Part 6: Are Property Auctions Better For Buyers Or For Sellers?
- Part 7: An Introduction To Buying BMV Property At Auction
- Part 8: What Is Off The Wall Bidding?
- Part 9: Property Auctions – Does It Matter Where I Sit?
- Part 10: Auctions Fees | What Are The Costs To Buyers And Sellers?
- Part 11: How Do I Prepare For A Day At House Auction?
- Part 12: Are Auction Properties More Commonly Vacant Or Tenanted?
- Part 13: What Are The Risks When Buying A Property At Auction?
- Part 14: How to Find and Work With Good Property Auction Houses
What Is A Legal Pack?
Amy: Can you talk a bit about the legal side of things at auction? I know you’ve mentioned legal packs before. What does a legal pack contain?
Andy: So a legal pack basically contains all the same as all the legal information you’d have if you were buying with a regular estate agent.
But because the time restraints are there – you’ve only got 28 days to buy the property – the seller packages all that legal information into a legal pack.
So there could be searches in there, some special conditions, office copies, literally anything legal to do with the property will be in that pack.
And I can’t stress this enough, it’s absolutely crucial you read it.
Amy: Really crucial, I see that.
Why You Should Consult Your Solicitor
Andy: Just like with property – we sell a different range of properties – every legal pack will be different.
Now without wanting to do a disservice to the buyers, it is a legally prepared document and a lot of it is legal jargon.
And because it’s so important, my advice is, that you don’t need to read it yourself.
I would just send it straight to a solicitor because that’s their job. They can translate it and advise.
So, for example, I bought my first house at a London auction. And I’m doing this job all day, every day.
But I knew that if I got one paragraph wrong it might cost me a few thousand pounds. So, like I took a builder out to see the building I was hoping to buy, I used the legal equivalent, my solicitor to look through the pack.
So, I emailed the solicitor and said: “I’m thinking about bidding for this property on Tuesday, can you check the pack and get back to me?” Two days later he came back and said It’s fine, fill your boots.
Now he might have come back and said, “be aware that there’s a shorter completion period,” or, “be aware that there are extra costs,” or, “be aware that it’s a short lease,” or whatever it might be, you know?
They’re all different and, like I say, I’m a big believer in paying the experts to do what they do.
Amy: Absolutely, I totally agree. Thank you.
Join Our FREE Property Training Course Today
Sign up for our free online property training course today.
In there we cover a range of different property strategies to help you get started on building a long-term property portfolio or creating a cash flowing property business.
We also look at ways to increase your return on investment with any of the properties you may be considering and we also have a couple of cheat sheets and downloadable documents in there as well.
Just click the image below to join our free training course today.
If you have any questions or thoughts about the use of the legal pack in property auctions then leave them in the comments section below.
Alternatively, you can get in touch via our Facebook page.
We’d love to hear from you and as always we’re happy to help.