The Auction Day Checklist: Five Things You Must Do Before Bidding
When you’ve finally found your dream home or ideal investment property after months of house hunting, it’s important to be prepared for auction day. Here are some essential steps to take before bidding:
Secure Your Finance:
Obtaining pre-approval for a home loan is crucial to bidding confidently at an auction. Alecto Finance can help you decide which loan is best for your needs, whether that’s a fixed interest loan or a variable one. It’s important to ask lots of questions and be well-informed before committing to a loan. If you’re a first home owner, be sure to research the current government grants available to you.
Building and Pest Inspections:
Even if the property looks beautiful, it’s important to ensure that it’s structurally sound. A building and pest inspection carried out by qualified tradespeople can save you thousands of dollars in the long run if any expensive defects are discovered.
Get the Contract of Sale – and Read the Fine Print:
The contract of sale contains all the legal information about the property, such as the title, boundary measurements, and recent building works. It’s important to thoroughly read and understand the contract before auction day. You can obtain a copy of the contract from the real estate agent or at an open inspection. It’s also a good idea to have a conveyancer or lawyer review the contract.
Set Your Budget:
While Alecto Finance or another lender may have provided you with pre-approval for a certain amount, there are additional costs to consider. These include loan application fees, building inspection fees, mortgage insurance, government fees such as stamp duty (which varies in each state and territory), and solicitor or conveyancing fees. To budget accordingly, it’s recommended to calculate your loan repayments based on an amount two percent above the current interest rate to allow for possible rate rises.
Register with Your Agent:
Some agents require you to register as a bidder or at least inform them of your interest in the property. A quick chat with the agent before auction day should be sufficient. If you’re not comfortable bidding, consider asking a friend or family member to bid on your behalf, but ensure that they are aware of your bidding limit.
Preparing for an auction can be daunting, but with the right preparation, you can bid confidently. Alecto Finance can provide valuable information and assistance in the lead-up to an auction, including beyond financial preparation.
It’s important to note that purchasing a property is a significant financial decision, and it’s recommended that you seek professional advice from a financial advisor, lawyer, or conveyancer before committing to a purchase.
In summary, securing your finance, obtaining building and pest inspections, understanding the contract of sale, setting your budget, and registering with your agent are all essential steps to take before auction day. By following these steps and seeking professional advice where necessary, you can increase your chances of securing your dream home or ideal investment property.
Want to learn more? Talk to our brokers today!
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