Don’t Get Caught Out! The Importance of Reading the Legal Pack at Property Auctions

Posted by Auction House London on 13th April 2023 -

Don’t get caught out! The Importance of Reading the Legal Pack at Property Auctions.

At Auction House London, we cannot stress enough the importance of reading the legal pack before purchasing a property at auction. Read on to learn why and how to protect yourself.

Buying a property at auction can be a thrilling experience, but it can also be fraught with risks, and you need to be careful.

Think of it like this: You would only buy a car after first checking the engine, the mileage, and the service history, right? Well, the legal pack is like the service history of a property. It contains all the essential information before bidding, such as any restrictions, potential issues, and legal obligations. More on that later.

Now, I know what you’re thinking. “But reading legal jargon is so boring!” But as a buyer, you must understand the “buyer beware” principle at property auctions. This means you must do your due diligence and ensure you have read and understood the legal pack before bidding on a property. Please do so to avoid costly surprises down the line. We strongly advise you to seek your solicitor’s advice before purchasing at auction to avoid these risks. They can help you interpret the legal pack and ensure you are fully informed about the property you’re interested in.

At Auction House London, we want you to make informed decisions when purchasing a property at auction. That’s why we provide all our buyer’s access to the auction property legal pack and work closely with theEssential Information Group –  to ensure that our legal packs are comprehensive and easy to understand. Once you register with EIG, they will notify you of any changes made to the legal pack throughout the process.

A legal pack is a collection of documents that provides essential information about a property for sale at auction. It includes title deeds, searches, leases, and other legal documentation. The seller’s solicitor prepares the legal pack, which is available for prospective buyers to review before the auction. Legal packs, when available, are linked to each property on our website.

The Potential Pitfalls of Failing to Read the Legal Pack

If you fail to read the legal pack, you’re potentially exposing yourself to financial risk. You could buy a property with outstanding debts or charges against it, making you liable for those debts. You could also end up purchasing a property with legal issues that prevent you from using it as intended, such as a property with restrictive covenants.

Failing to read the legal pack is one of the buyers’ most common mistakes at auction. This lack of due diligence can result in significant financial losses, making it essential to take the time to read the legal pack thoroughly.

Top Tips for Reading the Legal Pack and Protecting Your Investment

When reading the legal pack, it’s essential to do so with the advice of your solicitor. They’ll be able to help you understand any legal jargon or complex issues and ensure you’re aware of any potential risks. Here are some top tips for reading the legal pack:

• Read the legal pack thoroughly, including all supporting documents.
• Check for any restrictions on the use of the property or any planning restrictions.
• Check for any outstanding debts or charges against the property.
• Check the title deeds to ensure there are no ownership disputes.

And finally, at auction, the seller usually pays a fee to the auction house for selling their property. However, additional costs associated with the auction property are contained within the legal pack that the buyer is responsible for. The auctioneer does not apply these costs, and the buyer must understand these costs before bidding on the property.

In conclusion, reading the auction property legal pack is essential when buying a property at auction. It gives you the confidence to bid and the peace of mind that you’re making an informed decision. Please don’t take any shortcuts when it comes to due diligence. Contact the team at Auction House London to discuss the essential steps towards carrying out your due diligence before purchasing a property at auction. If you want to know more about buying property at auction – check out our link here

Good Luck and Happy Bidding.

Read article on the Auction House London website 

---

Find property at auction on The Landsite 

Discover more real estate services and properties on The Landsite, the leading hub for the real estate sector.