Things to do prior to the auction

When you purchase at an auction, the sale is final. Therefore it’s important to do your research and make sure you are prepared. Here are some key things that you should do prior to the auction to increase your chances of success, not only in securing a property, but for your overall financial strategy.

Pre-purchase inspections.

Be sure to organise a pest and building inspection report on a property long before auction day.

If the report identifies key faults, ask the selling agent if you can take your builder for an inspection of the property to get an idea of likely repair costs. It is vital that you know exactly what you are buying and what it will take to bring it up to your desired standard.

Ask your solicitor to check the contract

Do not bid on a property until your solicitor has given you the all-clear. Contracts for sale are complex and without the benefit of a cooling-off period, you will have to live with any nasty surprises about the property if you’re the highest bidder on auction day.

Arrange loan pre-approval

Making a bid at auction without the certainty of loan finance is a very high risk strategy. It makes more sense to secure loan pre-approval as this will give you confidence as a bidder and set a limit on your bidding power.

Set a limit – and stick to it

With loan pre-approval under your belt, you should have a good idea about how much you can afford to pay for a property. But this doesn’t have to equal your highest bid. Only pay what you believe the property is worth based on similar homes you’ve seen in the area. Paying more than this could mean waiting years for your home to grow in value.

Register to bid

Check if you need to register to bid. This is a requirement of some state governments, and where it applies you will be given a bidding number to use.

We work closely with our clients each step of the lending processes to ensure you are clear on what you can borrow, how much deposit you will need and what additional factors you need to consider.  We also help our clients obtain pre-approval so that they can make offers on houses or bid at auctions with more confidence in their borrowing capacity. I can also help you obtain a free property report to help you understand the value of the property you are interested in.

Remember, a critical aspect to your success is securing your finance and obtaining pre-approval.  To obtain pre-approval, get in touch today, or complete our 5-minute home loan assessment.