Buying a repossessed house - mortgage in principal first?

Belfast_tech · 17 Sep 2012 at 12:09

I found a house advertised by an estate agency that I was interested in but hadn't contacted them yet to arrange a viewing.

I have now discovered the advertisement has been updated to say: "Notice of offer: we have been in receipt of an offer for £xk please advise if you wish to add another offer".

I assume this indicates the house was a repossession and the estate agents are acting as brokers, as the status of the house is still "For Sale" rather than "under offer".

I have only been to the bank to talk about the possibility of a mortgage - I don't have a mortgage in principal or anything formal... would I be wasting my time arranging a viewing & contacting the estate agency about a house if it's already had an offer put on it? At this stage is it too late to kick off the process?

Thanks in advance!

VoG · 17 Sep 2012 at 12:11

Until the sign says SOLD, then it's never to late to put a counter offer in.

Windle · 17 Sep 2012 at 12:16

Until contracts have been exchanged anything can happen, that being said you should really have an agreement in principle with a mortgage lender before making an offer. Basically just confirms that they should (all things being well) lend you the money required.

Belfast_tech · 17 Sep 2012 at 12:21

Sorry if I sound daft with these questions - I still live at home and I'm looking for my first house - thanks for your answers so far...

1. Before I contact an estate agent should I have obtained a mortgage in principal from the bank / lender? What if I decide to go for a mortgage which works out less than what was originally agreed in the MIP?

2. Is it better to view a few houses then go to my lender & ask them for a mortgage which suits that property price, or the other way round?

Quint · 17 Sep 2012 at 12:26

I saw a house online, got a mortgage in principal then viewed. You can do that on the phone, some do it after viewing but I guess it depends on how sure you are on being able to get one and having the right deposit.

Btw if you go in with a mortgage in principle already, it might help you get the offer accepted over someone else, plus you have no sale of your own so could go through quicker.

Windle · 17 Sep 2012 at 12:48

Belfast_tech said:
Sorry if I sound daft with these questions - I still live at home and I'm looking for my first house - thanks for your answers so far...

1. Before I contact an estate agent should I have obtained a mortgage in principal from the bank / lender? What if I decide to go for a mortgage which works out less than what was originally agreed in the MIP?

2. Is it better to view a few houses then go to my lender & ask them for a mortgage which suits that property price, or the other way round?

1) You can contact the agent before, ie if you wanted a viewing but before making an offer it's best to have an AIP.

2) An AIP isn't that detailed, basically they will credit check you and review your salary, deposit available etc. They will then tell you how much money they will be willing to lend you (a mortgage cap in essence). This just gives you security that you can achieve a certain level of mortgage funds. If you get an offer accepted you can then review in more detail the mortgage available with that lender or even switch to a different provider.

BombayMix · 17 Sep 2012 at 13:08

Windle said:
1) You can contact the agent before, ie if you wanted a viewing but before making an offer it's best to have an AIP.

2) An AIP isn't that detailed, basically they will credit check you and review your salary, deposit available etc. They will then tell you how much money they will be willing to lend you (a mortgage cap in essence). This just gives you security that you can achieve a certain level of mortgage funds. If you get an offer accepted you can then review in more detail the mortgage available with that lender or even switch to a different provider.

It also give the agents confidence you can afford the property. So, they be more likely to show you around.

I'm buying a place and I've found agents very slow to update websites when an offer comes in. Some don't seem to do it at all. Likewise some will show you around a place under offer while some won't. It all depends....

PapaLazaru · 17 Sep 2012 at 13:10

Mortgage in principle first or the agents could get difficult. A lot of them now want proof you can buy a house first.

cm1179 · 17 Sep 2012 at 13:12

go and speak to a solicitor about buying a repossessed property and what it means for you in the future and what it takes to get this sorted....