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Buying repossessions

How to bag a bargain and what to watch for

Itís possible to pick up repossessed or distressed properties at up to 30% off the market price. If you're willing to put the work in these can represent some of the best buys available.

This quick guide runs through how it works, how to find bargain properties, using the top auction houses and more.

Buying repossessions - essential info

Buying a repossed or distressed property can be a minefield so make sure you do plenty of research beforehand. Here are our top tips to set you off to a good start:

Banks want to flog repossessions quick, so you can bag a bargain

Homes being flogged after repossession can go mega-cheap, because the seller - usually a bank or developer - is after a quick sale... Full info

This isn't just about doer-uppers - you could bag a new build too

Many repossessions were previously owned by borrowers who fell behind on mortgage payments. But others are new-builds and... Full info

You can cut up to 30% off the market value

Prices are anything between 10% to 30% off market value - usually the more work they need, the bigger the discount, although... Full info

Donít buy a wreck on a whim

Your best bet is to visit the property several times, crucially, with a solicitor or surveyor. There are properties out there for under £20k... Full info

Struggling with mortgage debt?

If youíre here because you're struggling to keep up with mortgage payments, read the Mortgage Arrears Help guide. For those under threat... Full info

Quick repossession buying tips

'Repossession' doesnít always mean 'bargain'. It's essential to view other properties and research the area thoroughly, just as you would with any other new house.

How to bid at auction

Property is very expensive and you need to know what you're doing before bidding. Here is a step-to-step guide on how to bid at an auction, although, this is just a brief guide. There are a number of good books on the subject that are worth reading beforehand.

If you've tried to buy an auction property, we'd love your feedback on the process. Please leave your comments in the forum's Buying Repossessions discussion.

Where can you find out about house auctions?

Auction houses that deal in repossessions have always been the favourite hunting ground of property investors. Yet because of the recession, a number of specialist websites have sprung up too. There's no perfect pick - they all have pros and cons, so please send us your feedback.

Searching several datatbases for auction properties, repossession search site PropertyEarth lets you speedily look for repossessed properties. Enter a town, price limit and number of bedrooms, and it reports back with homes that fit the bill. It doesnít sell; it sources its data from estate agents, lenders and property developers.

Another way to track down repossessions is Whitehot Property, a middleman which sells homes on behalf of lenders. There are hundreds of homes listed, some going for as little as £20,000 (though these could be a bit tatty). Certain properties come with incentives such as stamp duty paid or discounted legal fees.

Other places to find out about auctions

Auction houses
Auction houses

If a bank can't offload a property through an estate agent, often it'll go to auction for a quick sale (sometimes they donít even bother with an agent). Several auction houses and agents auction off repossessions, including Allsop, Savills and Barnard Marcus.

Local papers
Estate agents & local papers

Often estate agents sell off repossessed homes, but donít advertise. Call them up and ask what they have on their books. Another way is checking the back of your local paper for announcements.

Paid-for services
Paid-for services

If you seriously fancy yourself as the next Sarah Beeny, there are paid-for sites that source repossessed properties for you. These are not recommendations, but are listed here in case people want to find out more.