“Auction finance” is a term that is used regularly but what does this actually mean? In reality, it is just finance that can be sourced within an auction timescale and the lenders and products available are typically the same you would be able to obtain if you were purchasing a property outside of auction.
It is a common misconception that auction finance means “bridging finance,” as whilst this type of short-term finance is often the easiest way to fund an auction purchase, it is possible to obtain a residential, Buy to Let or commercial mortgage within an auction timescale. Some lenders offer products that are specifically offered for auction purchases however unless these offer either a desktop / automated valuation, or no valuation at all, as well as a speedy legal process, often you can get more for your money by considering one of the many other bridging finance products available (or a long-term mortgage facility).
If you plan to purchase a property from auction to live in or to rent out and it is in a liveable and lettable condition (if Buy to Let) then a long-term mortgage facility can be arranged within 20 working days. We still approach the same lenders as for any other purchase, just with a focus on those that can work quickly and produce an offer as soon as possible, leaving adequate time for the legal work to be completed.
For commercial property, a long-term mortgage is trickier within an auction timescale as these mortgages typically take longer to arrange than other types of finance. The property needs to be let and all additional information needs to be made available within a couple of days of the hammer falling to give any chance of securing completion however it has been done! An alternative strategy with commercial or semi-commercial property is to submit a short-term, bridging application and a long-term mortgage application at the same time. Funds are made available by the bridging lender for you to complete on the purchase, whilst the separate mortgage application progresses at the same time. This means you get the purchase through within the deadline but then spend as little time on this more expensive finance as possible.
Residential, Commercial and Mixed-Use (semi-commercial) property can all be purchased at auction, as well as land for development. Finance can be available for all of these and our experience in funding auction purchases will ensure that the most-competitive loan or mortgage will be arranged in the shortest possible time.
The Team at Aspire Property Finance specialise in arranging auction finance. Our knowledge and over 15 years of experience will help you confidently purchase property or land at auction. Whether a long-term residential, buy-to-let or commercial mortgage, or short-term bridging finance, we can source products to meet the demands of an auction purchase, achieving completion within auction timescales.
We will work closely with you to ensure that you go to auctions feeling fully prepared by reviewing your loan options on target properties and providing you with indicative terms. Buying property from auction is an exhilarating yet nerve-racking process. There are most definitely bargains to be had but preparation is key to making sure that what you get is what you hoped for!
Please get in touch for more information on how we can support you with your Auction purchases
01225 800849
enquiries@aspirepropertyfinance.co.uk