290 thoughts on “Dealing with property auction issues”
Hi, I won a property at auction, applied for mortgage, the lender did valuation and said the house has constructional issue of movement and cracks in the walls and they are not able to value, which means no mortgage. I have paid 10% deposit and the completion date is in a week, I cannot pay for the rest in cash. What can I do? Can I withdraw from this sale? Would I be able to get my money back? There was nothing mentioned in the legal pack of the auction regarding this constructional problem.
Thank you for your comment. While we cannot give specific advise based solely on this, the issue here is that when you put in a bid on a property at auction, the moment the hammer falls, if you are the top bidder, you are contractually bound to complete the purchase. If you do not complete, you would be in breach of contract and that contract and/or applicable law may provide for sanctions such as forfeiture of the deposit and/or costs the seller has incurred as a result of failure to complete.
It may be possible to argue that there was a misrepresentation if the seller did not mention the structural issues, for which you may be able to seek damages and/or the rescission of the contract. However merely failing to mention it in the legal pack or other documentation is not enough to give rise to such a claim. You must be able to point to specific false statements made by the seller or those acting for them, on which you relied, and were entitled to rely, and lost out as a result. Please feel free to telephone our Litigation department at the Braintree office to discuss this further.
i bought a property via auction, i was selling my house to a cash buyer, this was to fund my auction purchase, i paid the £6k for auction fees which they said i had to pay the same day as i won the auction (i was the only bid), but my cash buyer has now pulled out of my house sale, i am trying to get a new buyer of my house, can i claim my £6k back if i am unable to sell my house, the auction company knew that i needed the cash buyer to buy my house so i could proceed, or can i extend the time to complete to give me time to find a new buyer
Thank you for your comment and I am sorry to hear of your difficulties.
Unfortunately, our initial view is that you are very unlikely to be able to get a refund of any sums paid to the auction company. Unless you have agreed something contractually in relation to this particular issue, then you will be bound by any contractual terms that you agreed to. From the seller’s point of view, I am sure you are able to appreciate that they want to complete the sale and this is why, unless you have negotiated specific terms, you will be liable under the terms of the contract that you agreed with the seller.
Hi I have a question, our property was entered in auction for month of March but it did not sell, so we had discussions and agreed for next month auction but meanwhile we had to renew our lease and asked not to enter the property for April month which they did, now we have new lease signed and do not wish to sell. But we are asked to pay withdrawal fee of £4000 plus vat. Whereas their terms were no sale no fee. Please advise if I need to pay this amount.
Your contractual liability to pay anything to the auctioneers would depend on a review of the terms of the contract agreed and a consideration of the factual circumstances. Even if we were able to provide specific advice on our website, which we cannot do, we would need to consider the contractual documentation and take detailed instructions from you before providing any advice on the position.
Do feel free to get in touch if you would like us to consider the matter further with you.
Delayed completion: what are your options when someone in your chain of property transactions is late? With a group of strangers all working toward completing on the same date, it's a wonder it ever works out on time.
This collection of cases of property misrepresentation claims should remind all of us how important it is to tell the truth on a Property Information Form
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Hi,
I won a property at auction, applied for mortgage, the lender did valuation and said the house has constructional issue of movement and cracks in the walls and they are not able to value, which means no mortgage. I have paid 10% deposit and the completion date is in a week, I cannot pay for the rest in cash. What can I do? Can I withdraw from this sale? Would I be able to get my money back? There was nothing mentioned in the legal pack of the auction regarding this constructional problem.
Thank you for your comment. While we cannot give specific advise based solely on this, the issue here is that when you put in a bid on a property at auction, the moment the hammer falls, if you are the top bidder, you are contractually bound to complete the purchase. If you do not complete, you would be in breach of contract and that contract and/or applicable law may provide for sanctions such as forfeiture of the deposit and/or costs the seller has incurred as a result of failure to complete.
It may be possible to argue that there was a misrepresentation if the seller did not mention the structural issues, for which you may be able to seek damages and/or the rescission of the contract. However merely failing to mention it in the legal pack or other documentation is not enough to give rise to such a claim. You must be able to point to specific false statements made by the seller or those acting for them, on which you relied, and were entitled to rely, and lost out as a result. Please feel free to telephone our Litigation department at the Braintree office to discuss this further.
i bought a property via auction, i was selling my house to a cash buyer, this was to fund my auction purchase, i paid the £6k for auction fees which they said i had to pay the same day as i won the auction (i was the only bid), but my cash buyer has now pulled out of my house sale, i am trying to get a new buyer of my house, can i claim my £6k back if i am unable to sell my house, the auction company knew that i needed the cash buyer to buy my house so i could proceed, or can i extend the time to complete to give me time to find a new buyer
Thank you for your comment and I am sorry to hear of your difficulties.
Unfortunately, our initial view is that you are very unlikely to be able to get a refund of any sums paid to the auction company. Unless you have agreed something contractually in relation to this particular issue, then you will be bound by any contractual terms that you agreed to. From the seller’s point of view, I am sure you are able to appreciate that they want to complete the sale and this is why, unless you have negotiated specific terms, you will be liable under the terms of the contract that you agreed with the seller.
Hi I have a question, our property was entered in auction for month of March but it did not sell, so we had discussions and agreed for next month auction but meanwhile we had to renew our lease and asked not to enter the property for April month which they did, now we have new lease signed and do not wish to sell. But we are asked to pay withdrawal fee of £4000 plus vat. Whereas their terms were no sale no fee.
Please advise if I need to pay this amount.
Thank you for your comment.
Your contractual liability to pay anything to the auctioneers would depend on a review of the terms of the contract agreed and a consideration of the factual circumstances. Even if we were able to provide specific advice on our website, which we cannot do, we would need to consider the contractual documentation and take detailed instructions from you before providing any advice on the position.
Do feel free to get in touch if you would like us to consider the matter further with you.