What Will Your House Auction Contract Contain?

Auction houses are interesting places. The atmosphere of an auction house is unlike anything you’re ever likely to experience. There’s excitement, tension, anticipation and a whole load of nerves! On top of all that there’s fun. However, fun aside it should not be overlooked that the act of buying property is a serious business.

Once the hammer has gone down on your bid you are in a legally binding contract. You must give 10% of the price there and then as deposit and pay the rest within a month. Therefore it is important to make sure you are fully prepared before making the bid and you know exactly what you’re letting yourself in for.

One of the main things to prepare is the finance. Since you will only have one month to pay the full balance you should organise your finances before going to the auction. Speak to your mortgage broker and explain your situation. Of course, another point of preparation is viewing the house. It is vital that you go see exactly what you will be getting for your money. If you don’t do this and the property you buy ends up being a disaster you have only yourself to blame. Worst still, you cannot do anything to go back on your agreement. The contract has been signed and that’s all there is to it.

The Contract

The contract you have to sign will include all of the major details of the sale. The name of the auction house will be included near the top of the contract as will the date and time the auction took place. Next will be the name and address of the seller including contact details. Then the name of the bidder will be printed along with his or her address and contact details.

The address of the property on sale will be included along with a brief description of the property. The description is not compulsory though and may not always feature.

The bid will feature quite prominently on the contract as this is the most important part. The contract effectively says that the seller has accepted this bid from the buyer for the listed property. The buyer and the seller will then both sign and date the contract making it legally binding. The contract will have been drawn up by a solicitor and checked over by the seller before the property went to auction.

If, once the contract is signed, you have problems with the property you can speak to the buyer, or do so through a solicitor but you will have to prove it is something you should have been informed about and were not. If you have not viewed the property or not bothered to have it surveyed then you may not be able to do anything about it if problems arise. If you are unsure about signed a contract speak to your solicitor before attending the auction to discuss any fears you have.