Purchasing property at auction requires expertise, speed and the ability to be flexible, especially when you have a short window in which to complete your purchase.
What is Auction Finance?
Auction Finance is a form of bridging loan provided by specialist lenders that can be used to purchase a property at auction, allowing a sale to be completed quickly. It is designed to support you in closing the deal promptly, assisting when auction houses require swift payment, which is often requested within a matter of weeks.
How can Auction Finance help?
The appeal of property auctions is continuing to grow, allowing investors access to properties often at below market prices. Supporting buyers when time is of the essence, auction finance can provide funding in situations where longer term finance options, such as mortgages, may be difficult to put in place quickly enough to meet deadlines.
Auction Finance can be turned around at speed, with lending decisions often made within hours of an enquiry and funds released in a matter of days.
With some auction houses requesting a cash deposit in order to secure your purchase, often up to 10%, and frequently carrying additional auction fees that are payable in the case of a successful bid, auction finance can allow you to arrange your funding in advance, guiding your purchase in determining the budget that is available and the specification of property that your lender will fund.
Having such a decision in advance can allow you to bid confidently, reducing the complexities of the process and clearing the obstacles for a successful investment.
What are the steps involved?
- Research: Establish what type of property you wish to add to your portfolio and review the upcoming auctions, allowing you to present property options and your investment case to your lender
- Provisional Acceptance: Your lender will review the feasibility of the investment opportunity, which may involve credit checks and valuations of the properties in contention
- Lending Conditions: The provisional acceptance may have indicated conditions that must now be considered within your purchase process. This can assist in narrowing your search for potential targets
- Hammer Time: Now you have the opportunity to go to auction and make the winning bid, followed by your deposit payment. This typically starts the countdown clock, with four weeks to pay your balance. With your auction finance in place, this is paid by the lender.
- Congratulations: With the financial steps finished and the routine legal process completed, you’ve successfully added a new property to your portfolio.
What are the key features of Auction Finance at Albatross?
- Loans from £50k – £5m
- Rates from 0.99% pcm
- Guaranteed to meet completion deadlines
- Streamlined underwriting process
- AVM/Desktop valuations considered
- Residential and mixed-use security assets accepted
- Commercial to residential conversions accepted
How can I apply?
Trusting your lender is vital when borrowing funds to purchase a property at auction. It’s this trust that empowers our mission at Albatross to simplify the process and work sustainably, today and in the future.
Our market-leading reputation is based on speed, service and deliverability making us the lender of choice when it comes to working towards tight completion deadlines.
To learn more about Albatross’ Auction Finance opportunities, speak directly to one of our decision-makers today.
Nils Raber, Associate Director
Telephone: 0208 079 7691
Email: nils@albatrosslending.co.uk