Dan­ger at mortgagee auc­tions

Southern Real Estate Guide - - Front Page -

and have your in­ter­est as pur­chaser noted.

It is then on the in­surer to no­tify any in­ter­ested par­ties should the cover be let lapse or can­celled.

Un­for­tu­nately there is still likely to be an ex­po­sure to wil­ful dam­age where a pur­chaser’s only re­sort may be through the courts, de­pen­dent on the cir­cum­stances.

• Get le­gal ad­vice. Ask your so­lic­i­tor to check through the auc­tion agree­ment and ti­tle fi rst.

Look for clauses that may im­pede you. You have no right to ob­ject to any de­fects in ti­tle and you will wish to en­sure that any caveats will be dis­charged on sale or be­fore. Oth­er­wise they will be your re­spon­si­bil­ity.

• Will you be able to get the oc­cu­pier out? If the prop­erty was a rent-to-buy you could find the ‘ ten­ants’ thought they had rights to buy the prop­erty and be un­will­ing to leave. This will be your le­gal prob­lem to rem­edy.

• Can you in­spect prop­erty prior to auc­tion? Re­moval of items, if not prop­erty dam­age, is not un­com­mon in mortgagee sit­u­a­tions.

• Is the prop­erty sold ‘as is, where is’ or with va­cant pos­ses­sion?

• Get a mort­gage pre-ap­proval. Work closely with a bro­ker or ad­vi­sor on this to en­sure your pre-ap­proval cov­ers your sit­u­a­tion.

A bro­ker or ad­vi­sor like us will also make sure you are aware of likely pit­falls and help you man­age a po­ten­tial sit­u­a­tion be­fore it de­vel­ops.

Buy­ing a prop­erty at auc­tion can be an awe­some ex­pe­ri­ence. It is not some­thing to go into with your eyes closed but you could just steal your­self a bar­gain if you un­der­stand the play­ing field.

If you are con­sid­er­ing such a move or just want to get into prop­erty in­vest­ment, please con­tact us to get all the help you could wish for.

• Al­lis­tar Walker is a Se­nior Fel­low of Fi­nan­cial Ser­vices In­sti­tute of Aus­trala­sia and an ac­cred­ited mort­gage/in­sur­ance ad­vi­sor. His full dis­clo­sure is avail­able at www.mort­gage­help.co.nz or he can be con­tacted at 410 6023 and en­quiry@ mort­gage­help.co.nz.

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