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Inside A Property AuctionWhat Investors Should Know About Property Auctions Before They Buy

Bidding on properties at auction can be addictive and exhilarating if you can get the property you want without someone else driving the bidding price up and out of your pre determined budget.

TV programmes like “Homes Under The Hammer” have created a real appetite among novice property investors, but can TV shows really give serious investors an insight into what really happens at a property auction, and what are the real processes involved with bagging a property bargain?

There is usually a wide choice of property types available at a property auction, and property purchases can be conducted with speed, price transparency and certainty of sale plus there is always the chance to bag a real property bargain every now and then, which could explain why so many people are looking at property auctions to provide them with suitable investment opportunities.

In order to be successful at auction, investors should have done thorough due diligence on the properties that they are interested including surveys and the interior of properties should be viewed wherever practical.

Serious property investors should be properly prepared prior to entering the auction room and ready to act quickly. It may appear to be a little daunting and overwhelming to begin with, but with practice and conducting the correct due diligence, you will soon be bidding to purchase properties at auction.

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A UK Land Registry worker used their position of trust to supply title deeds and ownership signatures to a property fraud gang who made millions by stealing other people’s homes.

Surjeet Chana, a worker at the Land Registry, along with a solicitor, a bank manager and drug traffickers targeted the elderly and vulnerable, typically, people who had moved into care homes, or were left to deal with probate estates

The gang swooped on empty houses, erecting estate-agency style signs outside, with the name and number of a bogus security firm.

If this led to no inquiries, the gang then changed the name on the title deeds and sold the property to unsuspecting purchasers.

One victim of the con, Freda Gallacher, a retired widow, had been granted probate of her late brother’s estate, including his house. When she went to see it, she was greeted with abuse from the new owner. Her brother’s name on the deeds had been replaced by someone else’s and the locks changed. Ms Gallacher said: “The whole experience has left me in near financial ruin and certainly taken a toll on my health. It is clear to me that I have been a victim of failings within the Land Registry.”

Another person had moved out of her home following a traumatic burglary, leaving their possessions behind and planning to return to it one day.

Police subsequently told them that they no longer owned the property.

At least nine properties together worth £3.8 Million (GBP) were known to have been targeted across South London, but detectives believe that many more homes changed hands due to the gang’s work.

Land Registry worker Surjeet Chana, 64, was instrumental to the plot, using her position of trust to supply title deeds and ownership signatures.

Detectives found £38,000 in cash in the loft of Chana’s £600,000 home.

Prosecuting attorney, Mark Gadsden, told a sentencing hearing at Southwark Crown Court: “This case concerns sophisticated property fraud and money laundering. The gang targeted unoccupied properties, pretended to be the lawful owners and then sold them on to unsuspecting third parties for large profits. Unsurprisingly, they left chaos in their wake. The crime was thoroughly amoral – criminality motivated solely by greed. Integral to the success of the fraud were a number of corrupt individuals and insiders.”

Ms Chana, who worked in the Land Registry’s customer information centre in Croydon, South London, was suspended from her job as a registration officer following her arrest in 2010 and was later dismissed after 33 years of service.

Another key conspirator was conveyancing solicitor Charles Spiropoulos, who worked for Andrews and Co solicitors in Peckham, London.

“He did the conveyancing for some of the properties, in the full knowledge that they were fraudulent sales,” Mr Gadsden said.

He said a business manager at Barclays in Purley, who cannot be named for legal reasons, helped the conspirators to launder the proceeds.

Judge Michael Grieve QC adjourned the hearing until tomorrow, when Chana will be sentenced along with Spiropoulos and a third man for conspiracy to commit fraud by false representation.

A Land Registry spokesman said that victims would be offered compensation. have featured many stories about property fraud including Donna Jeavons property investment horror story – Read it here!

In the four years to the end of 2010, the Land Registry paid out £26 Million (GBP) in compensation to victims of property title fraud.

For landlords whose properties may fall void, this latest case underlines the importance of putting in place extra security measures on Land Registry documents. Speak to a solicitor to arrange these extra checks, which the Land Registry itself strongly recommends.

Landlord Sally Lawson offers help and advice for landlords worried about property theft and Tenant Identity Fraud – Read It Here

Property investors and home buyers now face bowing down to their lender’s choice of conveyance solicitor or even having to pay twice to use their own solicitor

As if finding the property, saving a deposit, passing credit and salary checks weren’t enough for would-be property buyers!

Lenders have thrown up yet another new issue – YOUR SOLICITOR!

An increasing number of borrowers are finding that their lender will not work with the law firm they have chosen to do their conveyancing.

This problem is likely to grow, causing a situation that reduces consumer choice and increases costs, hassle and delay to the buying process.

Mortgage lenders have always had panels of law firms they are willing to work with, but in the past few months big names such as Santander, Nationwide and Lloyds Banking Group have all reviewed and reduced those lists – in some cases removing solicitors who have worked with them for more than 20 years.

Lenders blame a rise in fraud as the reason for the cull – criteria have been tightened and a smaller panel should be easier to keep an eye on. No lender will say how many solicitors have been dropped, claiming the information is commercially sensitive, but the Law Society says it is hearing daily from firms that have been removed from panels, or have other concerns about them. Some do not even realise they have been dropped until contacted by a borrower who has instructed them.

Borrowers may only find out their solicitor is not approved when they apply for a mortgage – by which point those who are selling as well as buying are likely to have instructed someone and incurred costs.

For those who are only buying, switching may not mean a fee, but it could mean using someone unknown rather than a solicitor you have used before or have had recommended.

The Council of Mortgage Lenders, (CML), is unapologetic, saying mortgage companies have been forced to act. “There has been a significant amount of fraud and loss to lenders and their clients out of conveyancing in recent years, the Law Society’s recent creation of a conveyancing quality scheme is a tacit admission of this fact”. says the CML’s Sue Anderson

While the Law Society argues that lenders can be assured that members of its new scheme meet strict standards, Anderson describes it as “untried, unproved, untested” and says “it is reasonable for lenders to take their own steps to control their risk”.

Unfortunately for borrowers who want to choose their own lawyers, the issue looks likely to rumble on. Some lenders say their lists are closed, so those firms that have been dropped through lack of business will not be able to get back on, and the chair of the Conveyancing Association, Edward Goldsmith, says he expects panels to go on shrinking. “In two or three years those panels will be further reduced – they will be almost like super-panels,” he says. He suggests that, ultimately, this will be good news for consumers. “The firms that remain on the panel will be those who do a good job.”

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