01 Nov Auckland law firm and lawyers | Purchasing a property at a mortgagee sale
Mortgagee auctions differ in that these types of auctions usually result from the existing owner having defaulted on their property / mortgage loan repayment.
Purchasing a property at a mortgagee sale carries additional risks for the purchaser and we have highlighted some of these in a previous Quay Law legal tip post (click link)
Below you will find an article out of today’s newspaper.
Should you wish to discuss your property sale or purchase with a conveyancer please contact the team of property lawyers at Auckland law firm Quay Law.
The real estate agents call it “an opportunity like no other” and they’re not exaggerating.
The multimillion-dollar home in the Wellington suburb of Mt Victoria has spectacular views of the harbour and the city.
It also has a heavily tattooed occupant who declares it is his home, it is not for sale, and he is not leaving.
The house at 48 McFarlane St, next door to the old St Gerard’s Monastery, used to belong to imprisoned tax fraudsters David Rowley and Barrie Skinner, who bought it two years ago for $2,130,000.
Now it’s available in a mortgagee sale, advertised with the words: “If you are prepared to take on a challenge, it could be yours too.”
Real estate company Harcourts is rather guarded about the condition of the house, declaring: “The exterior appears intact but the interior appears not to be.”
But there’s no chance to check it out: “There will be no appointments for viewing and any inspection will only be possible from the outside.”
Agent John Callam said that photographs taken inside the house about three weeks ago, when it was vacant, indicated the kitchen had been ripped out and that floorboards had been pulled up in many of the rooms.
As for the resident, would-be buyers would have to take into account that it was not being sold with vacant possession and they would have to get their own legal advice on how to deal with that.
Mr Callam had no idea what effect all this might have on the sale price. The property has a 2009 rating value of $1,850,000.
Westpac, which holds a mortgage on the property, had given its solicitors instructions to sell, Mr Callam said, and such hazards were not uncommon with mortgagee sales.
“It is what it is and we have to deal with it.”
When The Dominion Post visited the house this week, there was a Maori sovereignty flag in an upstairs window and the man who came to the door said he partly owned the property.
The man, who would not give his name, said: “At this present time, this house is not for sale.
“I’m just going to renovate the whole thing out and nothing’s happening with the house.”
So if someone bought it in a mortgagee sale, what would happen? “Well, we’ll see about that then,” the man said.
The man laughed at the suggestion that a buyer might get more than they bargained for.
Property lawyer Peter Barrett said there were all sorts of hazards with mortgagee sales when properties were sold “as is, where is”.
Potential buyers needed to do their homework, as such deals were unconditional.
There were no guarantees or comeback on the vendor, the property might not be insured and, if someone was living in the house at the time the property was transferred, the buyer might have to seek an eviction.
Former accountants Rowley and Skinner are now serving 8 years and 8 years respectively after being found guilty in July of a multimillion-dollar fraud against Inland Revenue. © Fairfax NZ News