How to Find Repossessed Houses for Sale in Liverpool
Friday 14th April 2023
How to Find Repossessed Houses for Sale in Liverpool
A repossessed house is a property that has been given back to the lender by a homeowner or landlord. This is usually because payments have been defaulted on for more than three months without a sufficient repayment plan in place.
Buying a repossessed house can be a great property investment. The sale can be quicker and cheaper than buying via the traditional route. Most repossessed properties are listed for sale via auction with no chain.
Keep reading to learn more about repossessed houses for sale in Liverpool, including where to find a repossessed property, how to buy one, and the benefits for buy-to-let owners.
Why are Houses Repossessed?
A repossessed property is a house, apartment, or other building that has been seized by the lender. It is classified as a distressed asset
Houses are only repossessed when the owner or landlord doesn't pay the mortgage payments for a prolonged period. Or if the owner decides to hand the property back to the lender due to unaffordability.
Most lenders start the process to repossess a property after three months of missed payments. However, this can be longer depending on the mortgage terms and how long it takes to get a court date.
It can also depend on whether a payment plan is put in place and followed. It's common for a payment plan to be agreed on at a hearing instead of before. But some lenders will agree to this without court action.
For example, after several missed payments, a new payment schedule can be agreed on by the owner and lender. If this is not followed, the lender will seek court action to repossess the property.
The process to repossess a property generally follows the following steps:
- Mortgage payments are missed
- A lender contacts the owner to arrange a repayment plan
- If missed payments continue, or if no response is received, the lender sends a hearing date to attend court
- You attend the hearing to state your case (to give the property back, request a new payment plan, etc.) - if no attendance, the repossession order will be automatically agreed to by the court
- If repossession is agreed upon, an outright order to vacate the property within 4 weeks is given
- You vacate the property by the given date - or bailiffs will evict you in-person
- The lender sells the property
Where Do Banks Sell Repossessed Houses?
When a bank repossesses a property, its main goal is to sell the house as quickly and cheaply as possible. Therefore, selling via an estate agent is not the first choice.
Most banks sell repossessed houses for sale in Liverpool at property auctions. This is because auction sales are faster (they can happen in as little as four weeks) and cheaper (due to skipping estate agent commissions and "normal" solicitor fees).
How to Buy a Repossessed House UK?
Buying a Liverpool repossessed property works similarly to any other sale at a property auction. Finding a good Liverpool investment property for a buy-to-let takes careful consideration to ensure good rental yields. Knowing where to invest is key.
Speak to a local estate agent (like Tuna Fish Property) to find repossessed houses for sale in Liverpool. We can put you in touch with good property auctions and find a suitable property for your investment.
It's a good idea to view the property and ask a solicitor to review the legal pack in depth before bidding. This ensures there are no unexpected issues with the property that will impact the buy-to-let investment.
When buying at a property auction, you'll need to pay an immediate deposit to secure the property. This is usually around 10% of the winning price.
A timeline of around 2 to 6 weeks is then provided to complete the purchase via a solicitor and arrange the remaining funds (via a buy-to-let mortgage or cash).
Summary
Repossessed houses present a great opportunity for property investors. Because such properties tend to be in good condition, listed between 10-30% lower than market value, they offer high net yields.
Considering property investment in a repossessed house? At Tuna Fish Property, we are your local property experts in Liverpool and are experts in property sourcing Liverpool. Contact us today for a chat about how to buy repossessed houses Liverpool at a discount to market value.
Or read our expert guide on how to buy at a property auction to secure the best investment.
