An auction pack is a bundle of documents that provides details a buyer would require when purchasing a property. It is prepared by the Seller’s Solicitors and is basically comprised of the following documents:

1. Official Copy Register of Title – this is a document from the HM Land Registry that shows the proprietor as well as charges and restrictions registered against the property

2. Title plan- This shows the plan of the property as registered at the HM Land registry

3. Special Conditions- This is a document that shows the conditions that govern the sale such as the payment of costs and when and how completion shall take place

4. Searches

Where relevant it will also contain

5. Property information forms

6. Fixtures and fittings

7. Leasehold information

8. Management pack

9. Any other relevant documentation

An auction legal pack is prepared by the Seller’ Solicitors and uploaded on the Auctioneers’ website. Buyers can access legal packs on the property details page on the Auction house’s website. The Auction room may also give you access to the hardcopy of the legal pack.

Both the Buyer and the Seller will be charged by the Auctioneers. The Seller pays for registration, whilst the buyer will pay a buyer’s premium as well as Administration fee. The seller may, however, include in their auction pack that the Buyer will reimburse them for their costs or contribute a certain amount towards their Auctioneers fees.

As a buyer, it is recommended that you consult a solicitor before auction. It is not compulsory however but highly recommended as a solicitor will help review legal documents and give legal standing of the property before a buyer can commit to the sale. Once a buyer signs a memorandum of sale, it becomes difficult to turn away from the sale as it is legally binding.

There are many risks and disadvantages that may be hidden in a legal pack therefore a solicitor may assist in giving a clearer picture before commitment to avoid unnecessary costs.

It is imperative that a buyer studies carefully all the documents in the legal pack. Particular attention should be paid to the Official copy title of register to ensure that the restrictions and covenants registered against the property do not affect your intended use of the property as well as the title plan to ensure that

It will be of importance to note the law society forms as this will help give direction and Information on the property such as the boundaries on the property and the maintenance thereof. The law society forms namely the TA10, TA6 and TA7 will also help you know, if the property has gas, or electricity and the suppliers of the same, the fixtures and fittings included in the sale and as the leasehold information. Also pay attached to the Agreement and/or special conditions as this governs the sale itself. Special conditions will help one know the additional costs they may have to bear above the sale price, completion details as well as the buyer’s covenants.

It is also imperative to pay attention to the local authority searches. This will help you know of any liens or claims on the property. As the new owner you will be liable for the same as such it is important to note such.

Also note whether the property is being sold under vacant possession or it is tenanted property. If the property is tenanted ensure that all the Tenancy requirements have been met and study the Tenancy Agreements and you will be liable as the new landlord.

If the property is a Leasehold, it is of importance to know the rental costs of the property as well as service charges and any other management issues.

Purchasing property at an auction has greater risks than buying through the conventional method of buying property, if not managed properly. Careful study of the legal packs and catalogue need to be done so as to try and mitigate the risks.

Some of the risks of buying property at an auction are:

1. Limited knowledge of the property

2. Overpaying for the property

3. Buying properties with problems

4. Extra costs hidden in the legal pack.

5. Unknowns surrounding auction terms and fees.

6. The failure to finance purchase of the property.

Auction fees vary with the Auctioneers. However, the usual basic fees for Buyers are an administration fee which may be a percentage of the property or a fixed amount and a Buyer’s premium (which ranges from 10%- 30% of the sale price) plus 20% VAT.

For a Seller most Auctioneers charge an entry fee which is usually a fixed amount, the catalogue illustration or advertising as well as the Seller’s commission and 20% VAT.

Auction fees range from 2% of the sale price to 10% depending on the Auctioneer. The practice is this percentage is paid when a property sales. However, there are other fees which are usually fixed such as entry fee and advertising fee which will have to paid whether the property sells or not.

A sale of property that is open to the general public and sold to the highest bidder. A bid is an offer made by a person bidding for the property stating that he/she will pay a specific amount for the property on sale. It is conducted by an auctioneer, a person empowered to conduct such a sale. The underlying purpose of an auction sale is to obtain the best financial returns for the owner of the property and to allow free and fair competition among bidders.

Legal pack review fees are usually fixed amounts that range from £300 plus VAT to £500 plus VAT depending on the property and the timeframe within which the legal pack is expected to be prepared

The review of an auction pack includes:

1. The review of the available paperwork

2. Interpretation of the title documents

3. Providing a written report on title in plain English.

The convenience that comes with Auction sales is high. They are a faster method of selling property as they have time limits which also reduce the chances of chasing. They also give you a much higher likelihood of success given the exposure afforded to the property. A higher price for this method is justified.

The fees are also higher as some Auctioneers are in partnership with estate agents and will have to settle the Estate Agents fees after sale which are usually a 30-50% of the Auctioneers overall fees