The legal pack: The key to property auction success

Property auctions offer a fast-paced route to acquiring an investment property, often at below-market value. But speed should not overshadow due diligence. A crucial element in this is the property auction legal pack. Understanding its contents is essential to informed bidding and avoiding costly mistakes.

Keep reading to understand what is included in a typical property auction legal pack in the UK and how KSEYE’s bridging finance can help you secure funding ahead of the auction payment deadline.

What is a property auction legal pack?

The legal pack is a collection of documents prepared by the seller’s solicitor and available to potential buyers before a property auction. It contains all legal information relating to the property, making it key for conducting due diligence before bidding. Unlike traditional purchases, where you have time for surveys and searches after an accepted offer, auction purchases are legally binding upon the fall of the hammer. Therefore, reviewing the auction legal pack before bidding is essential.

What key documents are in a property auction legal pack?

While specific contents may vary depending on the auction house, a standard property auction legal pack generally includes:

Official Copies of the Title

These documents from the Land Registry prove the seller’s ownership and detail existing rights, restrictions, or covenants on the property (e.g., rights of way, easements, restrictive covenants). This is crucial for understanding exactly what you are buying.

Local Authority Searches

These searches detail information held by the local council, such as planning permissions (granted or refused), building control certificates, local land charges (e.g., road widening schemes), and environmental issues (e.g., flood risk). Understanding potential planning constraints or environmental concerns is vital.

Property Information Questionnaire (PIQ) / Seller's Property Information Form (SPIF)

Completed by the seller, this details the property’s history, neighbour disputes, services, utilities, and known defects. While sellers are legally obliged to disclose certain information, independent checks are always advisable.

Special Conditions of Sale

These are additional clauses specific to the auction sale, which override standard conditions. They might cover specific property issues, such as shared access, boundary disputes, or outstanding planning applications. This section of a legal pack can often contain important details not covered elsewhere.

Copies of Leases (if applicable)

If the property is leasehold, the legal pack includes a copy of the lease which details lease terms, ground rent, service charges, and leaseholder restrictions. Understanding the lease is crucial for leasehold properties.

Energy Performance Certificate (EPC)

An EPC certificate provides information about the property’s energy efficiency. With both existing and upcoming requirements of specific EPC ratings to be able to let a property, this is important to understand.

Environmental Searches

These will often look at contaminated land, flood risk, and other environmental factors.

Where to access legal packs

Legal packs are typically available for download from the auction house’s website a few weeks before an auction’s date. Where auctions take place in person, they may be available in the room. They may also be available for inspection at the auction house’s offices. 

To touch on some of the more popular property auction houses in the UK, Savills, Allsop and Auction House all include a link to the relevant legal pack on the individual page for each lot on their website.

Why reviewing the property auction legal pack is important

Reviewing the legal pack is important because it allows you to bid with increased knowledge of the property that is not available just by looking at the lot online. The legal pack can highlight legal issues, such as restrictive covenants, planning disputes, or boundary issues, that could affect the property’s value or future use. It confirms the seller’s ownership and identifies existing rights or restrictions.

Ultimately, it provides the information needed to assess the property’s value and determine your maximum bid. By thoroughly reviewing beforehand, you can avoid unexpected legal issues after the auction, which could lead to costly disputes or even the collapse of the purchase.

It is strongly recommended that you instruct a solicitor experienced in property auctions to review the legal pack. They can identify potential red flags and advise on the legal implications.

Please note that KSEYE is not a solicitor and can not provide this advice.

KSEYE: Specialists in auction bridging finance

While checking the legal pack is crucial for successful auction purchases, it is equally important to secure funding by the payment deadline. KSEYE offers bridging loans designed specifically for property auctions, and we can even pre-agree auction finance, so the process is already underway if you win the lot. Our bridging loans offer:

  • Fast Completion Times: We understand the time-sensitive nature of acquiring finance for auction purchases and can provide funding within days, ensuring you meet the necessary deadlines.
  • Flexible Products: With a lower rate Lite product range alongside our fully Bespoke bridging products, we offer tailored bridging loans to your needs, with flexible repayment options.
  • Expert Support: Our experienced team has worked to provide funding for many auction purchases ahead of the deadline and understands the importance of keeping you updated every step of the way.

Conclusion

The property auction legal pack is indispensable for anyone considering buying property at auction. By thoroughly reviewing its contents and seeking professional advice from solicitors, you will be well-positioned to make auction purchases with a higher chance of being worthwhile investments.

Securing pre-approved finance from KSEYE will enable you to go into an auction with confidence, and increase your chances of a successful property auction purchase. Contact KSEYE today to learn more about how we can help you to fund your property auction purchases.