Sheriff AuctionsBackgroundSheriff's auctions, also known as sales in execution, is a legal mechanism and occassion where properties are sold by the sheriff of the High Court. In 90% of the circumstances the owner of the property has either stopped paying or made inferior payments to the bond holder (the bank). After two or more consecutively missed payments, the bond holder will communicate with the owner about finding a means of rectifying the situation. Should the owner not oblige, the bond holder will obtain a judgement in court against the owner for the amount owing. Should the owner still not pay, the bond holder will proceed with selling the property in execution to regain the funds loaned, i.e. on an auction by a sheriff to the highest bidder. Throughout the process, the owner is given the maximum opportunity to retain his property - either by selling it, or by putting down a significant part of the amount in arrears. Often the sale of a property is cancelled moments before the start of the auction. The whole process typically takes at least a year. In Altiru's experience the shortest time between the first non-payment to the date of sale is about 9 months. At the sale in execution the bondholder (bank) often bids against other buyers present. Since the bondholder only wants to protect its own interests, it will seldom bid higher than the judgement amount. In fact, since the banks do not want to end up with a substantial residential portfolio to administrate, they will often stop bidding at 70%-80% of the judgement value, and sometimes even less. But should the highest price on the auction be the bondholder's, then the property for the first time becomes a repossessed property, or repo house as it is colloquially referred to. The property now moves to another department at the bank where it is now known as a property in possession (or PIP). It is possible to purchase the property afterwards from the bank, however at a significantly higher price. The buyer is then still liable to pay the arrears and has to take occupation himself. Purchaser's Obligations
Occupation of the PropertyOn the positive side, the purchaser may take immediate occupation of the property. Should the property be vacant, the process to find a tenant can be started immediately. Should there already be tenants occupying the premises, the purchaser is entitled to receive the rent payable by the tenants with immediate effect. It is only when the property is still occupied by the ex-owner that the purchaser may first have to get him/her to move out and vacate the premises. Unfortunately, but understandably so, occupation of your freshly bought property is not guaranteed, and it may cost a significant amount in legal fees and lost income to get rid of an uncooperative owner. Altiru, however, has an excellent track record to convince the ex-owner to move out on amicable terms (see the next section "Risks & Rewards").  or fill in the form bellow with your request and we'll contact you back
|
