Auction Conveyancing Solicitors

Written by Nicola Ryan

26th Oct 2022 (Last updated on 16th Feb 2023) 7 minute read

Do I Need a Solicitor to Buy a House at Auction?

When buying a house at auction, you will need a conveyancing solicitor to guide you through the process. This is because the conveyancing process is very different from a normal house purchase. You’ll be contractually bound to buy the property after you win the bid, so it’s a very fast conveyancing and auction process.

Your solicitor's primary role will be to review the legal pack. This pack is crucial as some sellers might not disclose certain information in order to sell the property faster. Before attending the auction, you need to know that the property you are bidding for is in the right condition.

What is a Legal Pack?

The legal pack is a compilation of documents that the seller must legally provide for buyers to do their homework about the property. Your solicitor will review this pack before the auction to ensure the information is accurate and to flag any issues about the property.

Sellers are legally required to provide this pack. Make sure that you read through the legal pack carefully and raise any queries with your solicitor beforehand.

Solicitors that specialise in auctions review this pack to flag suspicious information. They will also complete other searches to look further into the legal pack, including a pre-auction report and title search. This will give buyers a better idea of the property’s condition. The review will also highlight issues that could make it hard to get a mortgage.

What’s Included in the Legal Pack?

Auction legal packs include the following documents:

• Official register of title
• Special conditions of sale
• Land registry
• Search information (environmental searches, such as drainage)
• Property information form
• Fixtures and fittings form
• Copy of the Energy Performance Certificate (EPC)
• Planning permissions
• Official leasehold information form (leaseholds only)
• Assured Shorthold Tenancy Agreement (AST) copy (tenanted properties only)
• Commercial Property Standard Enquiries (CPSE) forms (commercial properties only)

Make sure that your legal pack contains the appropriate information and raise any queries with your solicitor.

What is a Pre-Auction Report?

A pre-auction report is an in-depth review of the legal pack before the auction itself. The report provides all the relevant information to help the buyer make up their mind about the property.

This report also consists of:

• A total figure for the buyer to expect to pay. This includes extra costs that the buyer will be liable for once the bid is successful.
• Additional searches, such as environmental and chancel check searches. This lets owners know about repair liabilities. For example, if the property owner is liable for the upkeep of the local church.
• The buyer’s solicitor will contact the seller’s solicitor to get information that is missing from the legal pack.
• A final, detailed report complete with post-completion formalities.

What is a Title Search?

A title search is an examination of public records to confirm the legal ownership of the property. It searches through tax liens, court judgements, deeds, and land records to confirm a clean title.

In a standard conveyancing process, you can raise any issues directly with the seller. Auctions don’t have a chain of transactions, so buyers very rarely get to meet the seller. The title search provides useful information for the potential buyer before making the bid.

The Auction Conveyancing Process

The auction conveyancing process is faster than the standard conveyancing process for the buyer and seller. This is because the majority of legal work is completed before the auction, which takes only a matter of weeks.

Here are the steps to buying a property at an auction.

1. Do Your Research
   Whether you’re a seasoned auction-goer or a first-time buyer, you need to do your research before bidding at an auction. This includes attending an auction as an observer to get an idea of the atmosphere. You should also read through the catalogue to understand what property you want.
   
   
2. Choose a Conveyancing Solicitor
   Your conveyancing solicitor will look through the legal pack. They will also complete the relevant conveyancing searches. This should happen before the auction.
   
   
3. Get a Building Survey of the Property
   It’s a sensible idea to get your chosen property surveyed by an RICS Surveyor before the auction. The survey will identify structural issues and give a professional opinion on the property’s condition. This means you will know whether the property is worth purchasing. You can opt for a Level 2 (Homebuyers Survey) or the more thorough Level 3 (Building Survey).
   
   On average, a survey costs between £290-£1,390. You will not get this money back if you choose to not make an offer on the property.
   
   
4. Sort Out a Mortgage in Principle
   A mortgage in principle indicates what your mortgage will look like if you have a successful bid on a property. Your solicitor will help here, as they will find out whether the property is suitable for a mortgage or not. A mortgage in principle can take several weeks to finalise, so make sure to do this before the auction.
   
   
5. Prepare Your Finances
   On the day of the auction, you need to be prepared with the cost of buying a house in case you win. You will have to pay the 10% deposit and auction fees on the day of the successful bid. You will also need to have money ready to pay the remaining 90% in the next 28 days. This is why it’s so important to have a mortgage in principle in place unless you are a cash buyer.

Auction and Solicitor Fees

Not only will you have to pay the 10% deposit within 28 days, but you will also have to pay auction and conveyancing solicitor fees.

You will pay the auction fees alongside the deposit. This figure will vary depending on the auctioneer, the chosen percentage of the purchase, and the cost of the property. This is known as the “Hammer price”, and will range from 1% to 3.5% (+VAT). Make sure to consider this in your overall budget.

Conveyancing fees will range depending on the types of services you need. The title check and pre-auction report are not legal requirements. However, they are highly recommended to ensure that you are confident with your purchase.

It is not more expensive to hire a conveyancer for an auction than with a normal house purchase. However, keep in mind that there is less time to pay this fee.

Paying for these additional services is recommended to lower the risk of an unexpected issue in your new property.

Do I Need a Mortgage to Buy an Auction Property?

A mortgage lender can’t offer money on a property that is deemed unmortgageable. An unmortgageable property can be one with subsidence or Japanese knotweed.

When buying a house at auction with a mortgage, you will need to be prepared in advance. This is due to the short period between the successful bid and payment, which is usually 28 days. Alternatively, if you are a cash buyer, then you won’t have to deal with the risks of a mortgage.

Read more about buying a house at auction with a mortgage.

Is Buying at Auction Legally Binding?

The moment the hammer falls, a successful bid at an auction is legally binding. This means you must complete the purchase of the property within 28 days, including the immediate payment of the deposit and auction fees.

The issue with buying property from an auction is that you cannot get out of the contract once the sale is won. In the instance that you can no longer pay for the property, you might be offered the chance to withdraw from the sale. However, you will lose out on the 10% deposit, auction fees, and conveyancing fees.

Finding a Solicitor for Auction

Compare My Move has a network of trusted conveyancers to help you find a solicitor for the auction conveyancing process. We can connect you with up to 5 licensed conveyancers, allowing you to compare quotes and save money on your conveyancing fees.