290 thoughts on “Dealing with property auction issues”
I would like to tell you my experience to seek your advice.
We bought a property at auction but the seller’s registration at the Land Registry has not yet completed. Land Registry have requested further information and upon receiving that the application will proceed but the seller’s solicitors have not been very cooperative. We are now in the position of potentially completing the sale with their registration not complete so we will not be able to proceed with our registration leaving us in legal limbo over the ownership of the property.
In the legal pack that was provided the seller’s name was not given. A letter of administration of probate was included of the previous (deceased) owner who is still listed as the owner at the Land Registry. It gave the impression that it was being sold as probate but we have since discovered that that was not the case.
Post sale we have found out that the seller is a private limited company who claim that they have owned the property for less than 6 months.and there is a clause saying that the Land Registry registration is ongoing but we cannot delay the completion if it has not been completed. We feel that the legal pack was misleading.
The searches were conducted in June but they only submitted the TR1 form at the end of September, just shortly before the auction. It seems that they have deliberately tried to hide their ownership.
Because the Land Registry record has not been updated we have been unable to verify that they are indeed the legal owner and despite requests to do so, they have failed to provide any written documentation confirming such.
This has made us concerned that we are a victim of fraud and face losing our life savings and our new home.
Both the estate agents and auction house involved, who are owned by the same people, say that they conducted AML checks but will not provide us with any written proof, saying that it is the job of the solicitor. The solicitor we are using is on a panel of the auction house but we feel that she is not representing our interests fully.
We do not know what we should do. Pull out and forfeit the money we have already paid plus possibly sued for damages or proceed with completion and possibly having to fight for the property. Also, since it is a private company which could be closed down at a moment’s notice leaving us in a bigger mess.
We cannot provide specific advice on our website. Your situation looks a little complex and would need to be considered in more detail.
What we would say is that whilst much more than a mere formality, registration of your legal ownership at the Land Registry is not the point in time that you become the owner of the property. Once completion takes place, technically you become the “owner”. If the seller was not entitled to sell the property, then there is a breach of contract and you would be able to pursue the seller for a refund.
We would suggest that you speak in detail with your solicitor and make sure you understand the position. Whilst a panel solicitor recommended by the auction house, they are still solicitors and obliged to act in your best interests and provide you with advice within the scope of their retainer and expertise.
We have purchased a property through auction company, the auction took place 27th October. The exchange was on the fall of the hammer on 27th October 2021.
The action pack contained information about the property recent sale and purchases land (registery documents). The last time the property changed ownership in the information provided in the legal pack was 2017. My own solicitor has done new searches after exchange it appears now the property was purchased on 18th October 2021 and sold at the auction on 27th October . Which means it’s less than 6months old. My mortgage will refuse to offer based on this.
It was not declared , the recent change in ownership, the special conditions of the auctioneer does clearly state that they will provide all paperwork they can but they may not be in date in all circumstances and it is for the buyer to do their own searches.
We will not be able to complete the purchase, as we have now lost the fees and 10% deposit deposit. Do we have a case for a claim?
Do we have a case, as the purchase without a mortgage offer is going to be extremely difficult.
We are unable to provide advice which is specific, as we are not aware of the full circumstances. However, we would suggest that if the documentation contained in the auction pack was misleading, there may be a basis of claim. Whilst the auction terms will almost certainly suggest that the buyer should make their own enquiries, there is a reasonable argument to ask why would an old, rather than up to date, official copy of title be included in the auction pack, if not with a view to imparting the information contained in it?
Do feel free to get in touch if you would like to consider the matter further.
I tried to buy a flat through an online auction but the sale collapsed because the seller could not arrange for an EWS1 Form to be uploaded to the Building Safety Portal as requested by my mortgage lender. The seller then terminated the contract and kept my £9000 deposit and the auctioneers kept the £6000 reservation fee. Google search has lots of information about EWS1 Forms and articles about problems with property (flat) sales caused by EWS1 Forms.
Here are some pertinent points for my case: When I first inquired about the online auction process and also when negotiating my bid price the Auction staff told me (over the phone) it would be a good idea for me to get a Mortgage in Principle in place before the bid, which is what I did. The Buyers Contract I signed offered the option to purchase the property with a mortgage and this is the option I selected. It was only realized later when the mortgage valuation report was produced that the property required an EWS1 Form to be uploaded to the Building Safety Portal. Without an EWS1 Form a mortgage was not obtainable. The EWS1 Form is not a legal requirement, however it is a requirement for mortgage lenders where an EWS1 Form is applicable, like in this case. The seller was made aware of the requirement for an EWS 1 Form. The seller issued me with a Notice to Complete which was obviously impossible for me to comply with unless the seller arranged for EWS1 Form to be uploaded to the Building Safety Portal so I could get a mortgage. The seller then terminated the contract and kept the deposit.
Do you think I may have grounds for a case (in court) to get my money back based on the following points :
– The Notice to Complete was served under an auction contract condition which said the seller must be ‘ready to complete’ otherwise they buyer may recover their deposit.
The Glossary section of the auction pack defines ‘Ready to complete’ as being : “if completion would enable the seller to discharge all financial charges secured on the lot that have to be discharged by completion, then those outstanding financial charges do not prevent the seller from being ready to complete. “
Given the above glossary definition is still the case that because the seller had not provided the information required (i.e the EWS1 Form) for a Sale Completion then therefore they (the seller) were not ready to complete?
– Without an EWS1 Form for the property a mortgage is not obtainable and the property can only be sold to a cash buyer. The Buyers Contract provided to me by the auctioneers gave me the option to buy the property using a mortgage and this is the contract option I selected, I did not select the cash purchase option. i.e the contract was based on a mortgage purchase only.
The Glossary section of the auction pack defines ‘Contract’ as: “the contract by which the seller agrees to sell and the buyer agrees to buy the lot”
Has there been some sort of breach of contract/misrepresentation here?
– Are there other grounds I may have for a case to reclaim my monies?
Thank you for your comment. Unfortunately we cannot provide detailed advice on our website. All we are able to provide is general guidance, which is not a substitution for properly and fully considered legal advice. We are therefore unable to respond to your specific points here.
Broadly speaking, a bidder at any auction would be well advised to ensure that they are able to proceed to completion after a successful bid. If the purchase is being financed by a mortgage, careful consideration of the mortgage requirements is absolutely critical. If there is information or documentation missing from the auction pack, and the seller will either not provide this or states that proceeding is solely at the bidder’s risk, then it is generally down to the bidder to decide whether or not to take the risk of proceeding but being unable to complete. We are not aware of any obligation on a seller in any context to supply to a buyer documentation required for the buyer’s mortgage lender’s purposes.
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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I would like to tell you my experience to seek your advice.
We bought a property at auction but the seller’s registration at the Land Registry has not yet completed. Land Registry have requested further information and upon receiving that the application will proceed but the seller’s solicitors have not been very cooperative. We are now in the position of potentially completing the sale with their registration not complete so we will not be able to proceed with our registration leaving us in legal limbo over the ownership of the property.
In the legal pack that was provided the seller’s name was not given. A letter of administration of probate was included of the previous (deceased) owner who is still listed as the owner at the Land Registry. It gave the impression that it was being sold as probate but we have since discovered that that was not the case.
Post sale we have found out that the seller is a private limited company who claim that they have owned the property for less than 6 months.and there is a clause saying that the Land Registry registration is ongoing but we cannot delay the completion if it has not been completed. We feel that the legal pack was misleading.
The searches were conducted in June but they only submitted the TR1 form at the end of September, just shortly before the auction. It seems that they have deliberately tried to hide their ownership.
Because the Land Registry record has not been updated we have been unable to verify that they are indeed the legal owner and despite requests to do so, they have failed to provide any written documentation confirming such.
This has made us concerned that we are a victim of fraud and face losing our life savings and our new home.
Both the estate agents and auction house involved, who are owned by the same people, say that they conducted AML checks but will not provide us with any written proof, saying that it is the job of the solicitor. The solicitor we are using is on a panel of the auction house but we feel that she is not representing our interests fully.
We do not know what we should do. Pull out and forfeit the money we have already paid plus possibly sued for damages or proceed with completion and possibly having to fight for the property. Also, since it is a private company which could be closed down at a moment’s notice leaving us in a bigger mess.
Thank you for your comment.
We cannot provide specific advice on our website. Your situation looks a little complex and would need to be considered in more detail.
What we would say is that whilst much more than a mere formality, registration of your legal ownership at the Land Registry is not the point in time that you become the owner of the property. Once completion takes place, technically you become the “owner”. If the seller was not entitled to sell the property, then there is a breach of contract and you would be able to pursue the seller for a refund.
We would suggest that you speak in detail with your solicitor and make sure you understand the position. Whilst a panel solicitor recommended by the auction house, they are still solicitors and obliged to act in your best interests and provide you with advice within the scope of their retainer and expertise.
Hello solicitors at cunningtons,
We have purchased a property through auction company, the auction took place 27th October. The exchange was on the fall of the hammer on 27th October 2021.
The action pack contained information about the property recent sale and purchases land (registery documents). The last time the property changed ownership in the information provided in the legal pack was 2017. My own solicitor has done new searches after exchange it appears now the property was purchased on 18th October 2021 and sold at the auction on 27th October . Which means it’s less than 6months old. My mortgage will refuse to offer based on this.
It was not declared , the recent change in ownership, the special conditions of the auctioneer does clearly state that they will provide all paperwork they can but they may not be in date in all circumstances and it is for the buyer to do their own searches.
We will not be able to complete the purchase, as we have now lost the fees and 10% deposit deposit. Do we have a case for a claim?
Do we have a case, as the purchase without a mortgage offer is going to be extremely difficult.
Thank you for your comment.
We are unable to provide advice which is specific, as we are not aware of the full circumstances. However, we would suggest that if the documentation contained in the auction pack was misleading, there may be a basis of claim. Whilst the auction terms will almost certainly suggest that the buyer should make their own enquiries, there is a reasonable argument to ask why would an old, rather than up to date, official copy of title be included in the auction pack, if not with a view to imparting the information contained in it?
Do feel free to get in touch if you would like to consider the matter further.
Hi there,
I tried to buy a flat through an online auction but the sale collapsed because the seller could not arrange for an EWS1 Form to be uploaded to the Building Safety Portal as requested by my mortgage lender. The seller then terminated the contract and kept my £9000 deposit and the auctioneers kept the £6000 reservation fee.
Google search has lots of information about EWS1 Forms and articles about problems with property (flat) sales caused by EWS1 Forms.
Here are some pertinent points for my case:
When I first inquired about the online auction process and also when negotiating my bid price the Auction staff told me (over the phone) it would be a good idea for me to get a Mortgage in Principle in place before the bid, which is what I did.
The Buyers Contract I signed offered the option to purchase the property with a mortgage and this is the option I selected.
It was only realized later when the mortgage valuation report was produced that the property required an EWS1 Form to be uploaded to the Building Safety Portal. Without an EWS1 Form a mortgage was not obtainable.
The EWS1 Form is not a legal requirement, however it is a requirement for mortgage lenders where an EWS1 Form is applicable, like in this case.
The seller was made aware of the requirement for an EWS 1 Form.
The seller issued me with a Notice to Complete which was obviously impossible for me to comply with unless the seller arranged for EWS1 Form to be uploaded to the Building Safety Portal so I could get a mortgage.
The seller then terminated the contract and kept the deposit.
Do you think I may have grounds for a case (in court) to get my money back based on the following points :
– The Notice to Complete was served under an auction contract condition which said the seller must be ‘ready to complete’ otherwise they buyer may recover their deposit.
The Glossary section of the auction pack defines ‘Ready to complete’ as being : “if completion would enable the seller to discharge all financial charges secured on the lot that have to be discharged by completion, then those outstanding financial charges do not prevent the seller from being ready to complete. “
Given the above glossary definition is still the case that because the seller had not provided the information required (i.e the EWS1 Form) for a Sale Completion then therefore they (the seller) were not ready to complete?
– Without an EWS1 Form for the property a mortgage is not obtainable and the property can only be sold to a cash buyer. The Buyers Contract provided to me by the auctioneers gave me the option to buy the property using a mortgage and this is the contract option I selected, I did not select the cash purchase option. i.e the contract was based on a mortgage purchase only.
The Glossary section of the auction pack defines ‘Contract’ as: “the contract by which the seller agrees to sell and the buyer agrees to buy the lot”
Has there been some sort of breach of contract/misrepresentation here?
– Are there other grounds I may have for a case to reclaim my monies?
I look forward to hearing from
Kind Regards
Gurtej Bains
Thank you for your comment. Unfortunately we cannot provide detailed advice on our website. All we are able to provide is general guidance, which is not a substitution for properly and fully considered legal advice. We are therefore unable to respond to your specific points here.
Broadly speaking, a bidder at any auction would be well advised to ensure that they are able to proceed to completion after a successful bid. If the purchase is being financed by a mortgage, careful consideration of the mortgage requirements is absolutely critical. If there is information or documentation missing from the auction pack, and the seller will either not provide this or states that proceeding is solely at the bidder’s risk, then it is generally down to the bidder to decide whether or not to take the risk of proceeding but being unable to complete. We are not aware of any obligation on a seller in any context to supply to a buyer documentation required for the buyer’s mortgage lender’s purposes.