Buying a Property in Possession

You may find it helpful to know that if you are making an offer to buy a property which is being sold by a mortgage lender in possession, the sales process will be different to sales by private treaty.

• This is because having obtained possession through the courts, a lender owes a duty to the court and to the borrower to use it best endeavors to obtain the highest price available for the property in the open market.
• If you make an offer, it will typically take two working days or so before a lender can confirm whether the offer is acceptable.
• When the lender accepts an offer, it will usually be subject to contract and subject to the lender not receiving a higher offer from another buyer prior to legal exchange.  This is because the lender has a legal duty to accept any higher offer on behalf of the borrower.
• The lender will seek any higher offer by advertising the property (usually in a local newspaper or a property website) to demonstrate it has used its best endeavors to obtain a fair price.
• If no higher offer is received, your purchase will proceed to legal exchange.
• If a higher offer is received from another party, then this new offer will supersede your original offer.  You will normally be provided with an opportunity to raise your first offer should you so wish.
• Where Peter Alan acts for a lender in possession, we are acting in accordance with their instructions and following the lender's process.  This process can vary a little from lender to lender.
  As a buyer, you will obtain exclusivity to the property on legal exchange.

We hope this summary of the process is helpful and will be very happy to explain any aspects that are unclear.

For and on behalf of Peter Alan