Apartment from bailiff's auction. Starting price? Up to 25% cheaper

Buying a flat at auction bailiff may be an opportunity to acquire real estate below market price. However, this form of purchasing a property involves certain formalities, risk and not always obvious rules. How does a bailiff's auction proceed? What worth knowing before you decide to take part? Below you will find a practical step-by-step guide prepared by experts from GetHome.pl.

The bailiff's auction is a public one an auction in which the debtor's real estate is sold for the purpose of satisfaction of creditors' claims. The court bailiff, acting on the basis of enforcement title, seizes the property, has it valued by an expert expert and announces the auction date. Auctions are public and everyone – meeting certain conditions – you can take part in them.

Information about upcoming In bailiff auctions you will find:

• On the website of the National Council of Bailiffs (https://licytacje.komornik.pl) – this is the main source of official announcements,
• On the websites of the district courts and bailiffs,
• In the local press or in official bulletins.

In the announcement you will find, among others: description of the property, its area, location, date and place of the auction, appraisal price and asking price.

Starting price in the first auction is 3/4 of the estimated value. If the property is not sold within the first term, a second auction is held, whose starting price drops to 2/3 of the assessed value. This means that an apartment worth PLN 600,000 can theoretically be purchased for PLN 400,000. zloty.

Note: despite the lower price starting bid, if more interested parties show up, the price may increase during auction.

To participate in a bailiff's auction, several conditions must be met:

This is a mandatory fee in 10% of the estimated value. Deposit must be paid in advance (usually by bank transfer) or in cash bailiff's office. If you do not win the auction, the deposit will be refunded. However, please note that if you win auction and then you do not pay the remaining purchase amount within the specified time the deposit is forfeited – no will be returned and will be included in the enforcement costs or losses. Therefore, the decision to participate in the auction should be well well-thought-out and based on real financial possibilities.

Auctions are usually held in the court building or bailiff's office. You must appear in person (or by proxy), present an identity document and confirmation of payment of the deposit.

You must have full capacity legal. If you buy on credit, the bank may require prior confirmation of creditworthiness, although a loan can also be taken out after winning the auction.

1. The bailiff reads the announcement about the auction and a description of the property.
2. Participants join auction, submitting subsequent bids (usually within 1% of the starting price).
3. Who will offer the highest amount and is not outbid – wins.
4. After the auction, the court must approve the result (this occurs at a separate meeting).
5. After the entry into force court order the buyer must pay the remaining amount (without deposit) – usually within 14 days.

One of the main problems may be the fact that the property is inhabited. Even after purchasing the premises in auction, its vacancy by the tenants may require eviction proceedings – which can be long and expensive.

It is not always possible prior site visit, but there is a formal the opportunity to view the property before the auction. For this purpose, you must submit a request to the bailiff to carry out an inspection. The bailiff may set a deadline for entering the premises – unless the owner makes it difficult to access. In practice, however, if the debtor refuses to cooperate or avoids contact, viewing the apartment may be difficult or even impossible. It is worth try anyway, because the information you get can have a significant impact on purchasing decision.

Buying from an auction does not give you warranty protection as in the case of a purchase from a developer or a third party private. You cannot complain about defects in the apartment or demand a price reduction. When you buy at auction, you generally do not take over the debtor’s obligations, but… there are exceptions. You need to check, for example, arrears in the housing community, utility charges, as well as the legal status of the property in the land and mortgage register.

Buying a flat at auction bailiff's office can undoubtedly be an opportunity to purchase real estate at a price much lower than the market price. No need to negotiate with the owner, clearly defined rules for participation in the auction and court approval of the transaction make it an attractive form of purchase for many people – especially in times when when housing prices are rising regularly. For a well-prepared buyer who has adequate funds or certainty of financing, the auction may prove to be an effective way to get your dream home or an interesting investment. What important, although access to the interior of the premises is difficult, it is possible submitting a request to the bailiff to view the apartment before the auction – However, it must be remembered that the decision in this matter depends on the specific case and consent of the property owner.

However, we must not forget that bailiff auction is also a big challenge and risk. Buyers do not always they have a guarantee that they will be able to gain access to the premises before purchasing it, which raises uncertainty as to the actual technical condition. Additionally, the apartments put up for auction are often occupied by their previous owners or tenants, which may result in the need to carry out a difficult and lengthy eviction process.

The transaction also does not provide any protection against warranty, and the deadline for payment of the full amount - usually very short - does not allow on flexibility. An important element is also a deposit. Although, as a rule, is refundable if the auction is not won, it may be irretrievably lost if the winner does not pay in the remainder of the purchase price within a certain period. Therefore, although bidding may be a realistic a chance for a profitable transaction, requires the buyer to be careful and have good discernment and, above all, stable financing.

Marcin Moneta

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