5 Things you must do before going to Auction
Sales at auction are unconditional, this means you must proceed with the purchase and can’t back out after the fall of the hammer! So before you turn up to bid, you need to ensure that you have completed these tasks;
- Decide on the absolute maximum price you are willing to pay as you will need to obtain your banks approval to our maximum purchase price.
- Get your finance as unconditionally approved as you can. The bank will need to approve the property you wish to purchase as well as the maximum amount you are willing to pay, so you must provide them with a copy of the auction sale and purchase agreement. You will also need to meet any other conditions of finance as required by the bank.(If for example the bank requires a registered valuation to be undertaken you will need to have this completed and approved by the bank before the auction date.)Ask your bank to confirm their approval with a letter of offer so you have this in writing.
- Complete any other inspections you require – ie Building Reports, Meth testing etc prior to attending the auction.
- Arrange for your conveyancer to review the LIM report, sale and purchase agreement and certificate of title before attending the auction.
- Have your deposit (usually 10%) ready to pay on the day of the auction. If your using Kiwisaver as your deposit please note that you can’t access these funds until settlement date so you will need to arrange an overdraft facility with the bank who have approved your loan – you will also need to arrange this prior to the auction. Overdrafts can be expensive, so we recommend keeping the deposit you need to pay to a minimum. Often you can negotiate the % of deposit to be paid but you will need to have agreement to this prior to the auction date.
For more tips and advice on auctions click here