Auction loans and how bridging finance can help
In order to complete a purchase at a property auction, including commercial property, the buyer must pay for the property within a certain time frame, often 28 days.
Obtaining a mortgage from a high street lender is often impossible under such strict time constraints, therefore a bridging loan is the ideal way to raise the finance required quickly, ensuring you adhere to the auction time scales.
A great aspect to buying a property with auction finance, is the diversity of options that become available to you. Having such a variety increases the opportunity to find the property that is right for you, and we’re here to help you open the doors to your auction purchase.
We are experts in auction bridging finance, and it has led our underwriters to speak at several property auctions, both online and in person, to provide our auction finance services to those who need it.
Their experience means they are equipped to deal an array of scenarios that may present themselves and reduce any potential risk that may arise in your application.
At MFS, we help our clients ensure that their experience is run smoothly. Our process is simple and provides you with a bespoke bridging finance service that is tailor made to suit your financial needs. Our loans are designed with only you in mind, fast and flexible, with competitive rates.
We’ve witnessed almost every type of property come available at auction, so don’t let your finance stand in the way of purchasing your future property.
The process of buying at a property auction
- As the winning bidder, you will be given 28 days to complete the purchase
- Our bridging loan product gives you the money you need to complete the property purchase within the allotted time frame
What is auction finance, and does it apply to me?
Auction finance is used to pay for items bought through auctions and are therefore intended for quick payments with a short turnaround time. Our bridging loans allow you to purchase property via auction. We provide you with the money you need to complete the property purchase within the time frame.
Auctions can be a great place to find old properties with great potential to invest and build profit or build up your property portfolio. Whether you’re looking to buy-to-let or refurbish an old property to sell on at a later date, we’re here to help you organise your finances to ensure you’re ready to complete your purchase.
We understand that auctions aren’t just for investors, so if you’re new to the auction community, that’s no problem at all. We’ll be with you every step of the way, guiding you through our process and answering any questions you may have.
How our bridging finance can help you:
Residential investments, Including HMO’s & Multi-lets
Refurbishments for auction property
What we do and why we’re great at it
When it comes to buying your first property, or your hundredth, remember this:
Don’t panic, we’re here to help.
Completing a property within such a limited time span can be tricky with a traditional mortgage, even more so if you’re looking to use commercial or more unusual property as your security for the loan.
Bridging loans are considerably quicker, with our completions being from as little as three days, even with complex circumstances. Our lending period also ranges from 3 – 18 months and with no early repayment charges, if circumstances change then you can exit at an earlier date that works best for you.
We pride ourselves on putting our clients first, so we tailor our bridging loans to suit your specific needs.
Our underwriters have plenty of experience and specialise in the complex, and they aim to minimise any delays that can potentially arise, to keep your finance running on time.
You will be provided with a dedicated underwriter for you case, who will happy to work alongside you before the auction, to help assess any issues that may be of concern for you.
Our loans will always require an exit plan, which can be through refinancing, re-mortgaging or even buy-to-let. Our loans are created around your personal financial position, so if you’re interested in how we can help you purchase a property via auction, contact our underwriters today to see how we can help you.
We are able to lend where many others may not, click here to see our full criteria.
Our bridging loans are available to individuals and businesses alike e.g. Limited, LLPs, SPVs, Offshore etc. and for an array of circumstances e.g:
- Discharging adverse credit
- Exiting IVAs
- Repairing CCJs
If you’re unsure if you are eligible for auction finance, contact one of our underwriters today. They will be able to take you step by step through our process and answer any questions you may have.
What you need to know before buying a property at auction
Buying at auction can be a great way to get the property you want and a great competitive price, but you can’t just go in blind sighted.
Invest your free time to research what type of property you are interested in purchasing. This way when you come to looking through auction catalogues, you’ll know what you want, and which auction will be worth your time attending.
Get your finances in place beforehand
This is the most important aspect. Confidence in your financial situation, knowing how much you have available to you, is a great starting place. Ensure your finances are in place before the auction, it will decrease the risk of your offer falling through, as well as keeping your stress levels low.
This is where we come in, we’re here to make the experience – or at least the financial side of it, simple, smooth and quick sailing. Our underwriters will deal with the paperwork, ensure everything is in place and sort out any documents etc that need to be ready quickly and efficiently, so that you are able to purchase your property with no financial worries.
Visit the properties you’re interested in
One thing you should keep in mind is there is always a reason why a property is at auction, and it is your job to find what that reason is.
Understanding what issues come with a property means that you can take this into consideration when bidding, this way you can be ahead of the game and prepare any possible additional finances that you may need.
Here are a couple of things to keep in mind:
- Has the property been on the market, if so, for how long?
- Has the property fallen through? If so, why?
- How long have the previous owners been at the property?
- What is the property’s history?
Download the legal pack
Small print can lead to trouble, so it is important that you understand every aspect of the legal documents, so speaking to a solicitor puts in the best advantage to reduce any potential risks with the property.
Certain aspects may be left out of the legal pack, so it is a good to receive legal advice. If you do receive an incomplete pack, this is a fair warning that there underlying issues with the property.
If you don’t receive the legal pack with plenty of time to consult a solicitor, this can also be another indication that there are issues with property.
What we do:
- Auction finance
- Purchase at auctions
- Bridging finance for auctions
- Refurbishments for auction properties