Auction Finance

Auction Finance

Auctions are the go-to place for below-market-value property deals; however, they’re often much faster-paced and require greater flexibility when it comes to funding. That’s what auction finance can help with.

With Pure Property Finance, you can secure a specialist bridging loan for auction property purchases, including development land, commercial property, and residential buildings. This way, you’re armed with the confidence to bid at an auction, knowing when the time comes, you can complete the purchase quickly.

What is Auction Property Finance?

Auction bridging finance is a subcategory of short-term loans specifically aimed at those looking to make advantageous property purchases at an auction. By taking out a bridging loan for auction property, buyers can be assured they’ll have access to the necessary funds within the designated 28-day timeframe.

As well as helping property owners get around the time constraints of some mortgage lenders, auction bridging finance can be a useful alternative for more complex deals, or properties in a condition that isn’t covered by traditional lenders.

How Does Auction Finance Work?

Normally, the winner of a property auction has to pay a 10% deposit upfront, before completing the rest of the auction purchase within 28 days. That’s where the challenge comes from with funding – a traditional mortgage can rarely be arranged with such a tight turnaround, but specialist auction bridging finance can.

At Pure, we collaborate with a range of specialist lenders to arrange finance for purchasing property at auction. The process has a quick turnaround, and follows these key steps:

Pre-auction: The first step of securing bridging finance for auction property is securing a decision in principle ahead of the auction, so you have an accurate idea of how much money you’re able to borrow.

Post-auction: Once you’ve secured the property at auction, we help you finalise the finance application with your lender, including details on when the funds will be released, in line with the auction house’s timescale.

Long-term: Once you’ve purchased the property, you can repay the money you borrowed through auction finance by securing a mortgage, reselling the property, or using a different exit strategy you planned for.

Why Choose Auction Finance Over a Mortgage?

Whether you’re looking to buy commercial or residential property at auction, you’ll be faced with deciding between a traditional mortgage or property auction finance.

More traditional lenders often need weeks (or sometimes even months) to arrange a mortgage, but beyond that, they might also not agree to fund auction purchases on properties in need of major repairs. Meaning, if you’re looking to buy property at auction for cheap and flip it, you might need to turn towards a short term loan.

Auction finance can often be arranged in under two weeks, with a more flexible approach to your circumstances and the condition of the property. That way, you can seize investment opportunities with speed and confidence, across both residential and commercial property assets.

What Are The Benefits of Auction Finance?

Quick turnaround – The biggest advantage of auction finance over more traditional options is the speedy access to funds to match up with auction house deadlines.

Confidence – Having pre-approval on bridging finance for auction property gives you the certainty to bid on your desired assets.

Variety – Auction finance gives you greater flexibility when it comes to the types of property you can purchase, allowing you to expand your portfolio with assets that aren’t traditionally considered mortgageable.

Competitive rates – Our team can support you in securing auction bridging finance deals which best match your goals and circumstances, whether it’s your first time buying property at an auction, or you’re an experienced investor.

Who Is Eligible for Auction Finance?

There’s a range of buyers who can take advantage of auction finance, including:

• First-time property buyers
• Career landlords
• Property investors
• Developers

Whether you’re putting money behind a residential property you plan to refurbish, or purchasing a commercial property as a long-term investment, there’s an auction bridging finance solution for your needs.

How Quickly Can I Access Funds?

Depending on your chosen lender and how complex your deal is, you can have auction finance funds released in as little as five days.

There are ways you can help speed up the process, including preparing all the necessary documents ahead of time, and working with an experienced auction bridging finance team.

Reliable Auction Finance, with Pure

Don’t allow delays in securing auction finance stand in the way of snatching a lucrative deal. Our expert team can support you in finding the right auction bridging finance for your desired assets, whether you’re buying property at auction to refurbish, as part of a development project, or as a long-term investment.

Get in touch with our specialist auction finance team today to learn more about the process of securing a bridging loan for auction property.