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Auction finance

Looking for Auction Finance to buy a property?

Looking for auction finance? The specialists at Clever Lending can give peace of mind by reviewing your requirements before going to auction, giving you an idea of the fees and costs before making a commitment.

This will give you confidence at the auction that you should be able to get the required funds.

As a specialist Auction finance broker, we can provide:

What is auction finance?

Auction Finance is used for buying a property at auction. 

These transactions usually require completion within a set timescale in line with the auction house requirements.  (This can be 14 or 28 days).

This type of finance falls under the bracket of Bridging Finance, which is mainly used when funds are required quickly, but not needed for more than 12 months, although this can sometimes be extended.

If your auction bid is successful, you will usually have to pay a deposit of 10% of the purchase price, plus auction house fees once the hammer goes down.

It’s unlikely a traditional mortgage can meet the requirements and flexibility needed for an auction purchase, especially as some properties at auction are not deemed as habitable or mortgageable in the current state.

How much can I borrow?

The amount you can borrow will depend on the project you’re planning – most lenders will offer up to 75% of the value of the property, which can increase to 85% if you’re planning to renovate and up-sell.

As with most property finance, the larger the deposit, the better the lender will view the application and the better chance you have of getting more favourable rates, but it’s worth noting that it’s sometimes possible to access up to 100% LTV if you have additional security, such as another property or asset.

Decision in Principle

This is where we come in, Clever Lending can talk you through the finance options, including any fees and charges that are payable.  If required, we can obtain a Decision in Principle (DIP) from a lender, which means you’ll have passed the initial credit and identification checks.

Rates from

Auction finance rates

from
0.42% per month
  • Up to 85% Loan to value for the refurbishments
  • Up to 100% of refurbishment costs
  • Lenders that work on the guaranteed value after works are completed
  • Light, Medium and Heavy Refurbishment projects (from internal works to conversions and extensions)
  • Staged releases
  • Buy to rent projects
  • Change of use - if changing the purpose of a building

Example fee’s

Speak to our specialist brokers about your situation by using the live chat option or calling 0800 316 2224.

Borrow £100,000 and you would approximately pay back
Interest Rate
Interest 0.4%
Interest 0.6%
Interest 0.8%
6 months
£104,795
£106,054
£107,325
9 months
£106,058
£107,974
£109,922
12 months
£107,336
£109,930
£112,581
Borrow £250,000 and you would approximately pay back
Interest Rate
Interest 0.4%
Interest 0.6%
Interest 0.8%
6 months
£258,431
£261,536
£264,671
9 months
£261,545
£266,272
£271,074
12 months
£264,696
£271,093
£277,632

The advisers at Clever Lending can give peace of mind by reviewing your requirements before going to auction, give you an idea of fees and costs before making a commitment. This will give you confidence at the auction that you should be able to get the required funds.

Case Study

Bridge for property renovation

Clever Lending helped a customer to achieve the following:

Balance Rate LTV Term
New Finance
£140,904
0.75% P/M variable
88%
12 months

Our partners

What next?

Use our callback form

Use our callback form below to speak to one of our experienced brokers and find the best lender for your auction finance.

Chat to us

Use our live chat facility or speak to us on the phone, our expert team are here to help find you the perfect loan for your situation. 0800 316 2224

Auction finance arranged

We are a broker, giving you access to the market for short-term finance. We deal direct with the lender and handle the application process for you.

Types of development loans

Bridging loans

This a loan you can use to buy a new property that you need to renovate before re-selling or renting on the market. You can use bridging to release equity you have in an existing property for up to 24 months.

Development finance

This is finance to extend or make structural changes to an existing property, maybe converting a house into flats, or maybe you are looking to build from the ground up on land with planning permission.

Commercial mortgages

You'll need a commercial mortgage if you're going to use the property for business purposes, e.g. as a shop.

Second charge buy to let mortgages

For if you own a buy to let property and would like to release some equity to start a new project.

Second charge mortgages

This is a loan that allows you to release equity from your main residence, often ideal if you are asset rich and need funds towards a development project.

As with most financial products, there are fees associated with getting a bridging loan. You can usually expect:

  • Lender’s fee – an arrangement charge is usually put in place by the lender for providing the loan, often around 2% of the total loan amount. Depending on the application, lenders may allow you to bundle this charge with the loan.
  • Legal fees – as there are legal contracts involved, there will be legal fees. It’s important to bear this in mind when planning your budget.
  • Surveyor/valuation fee – the lender will want to survey the property to ensure your plan reflects the reality of the property, which you’ll usually have to pay as part of the arrangement process.
  • Exit fee – this entirely depends on the terms of your auction finance. Some lenders will require a fee when exiting the loan, some may only ask for one if you repay early, whereas others may not stipulate an exit fee at all.
  • Broker fee – finding the right financial product isn’t always easy, which is why we have specialists on hand to do the work. The right advice can make the world of difference when navigating financial territory and using a broker can give you access to rates and deals which might not be advertised on the public market.

6 Great Reasons to Choose Clever Lending for a bridging loan

In-house regulated bridging advice
We have a dedicated team of qualified specialists who are ready to discuss your regulated bridging advice enquiries

Market-leading rates
Competitive rates on bridging loans with 100% LTV available with added security

Hundreds of products
First, second and third charge bridging loans available from £25,000 with terms from 1 month to 24 months

Staged release on development
Borrowers can secure renovation funds for various stages of their property renovations 

No exit or legal fees
We can offer bridging loans with no exit fees for flexibility of the investment plan

Manage all enquiries online
Manage all bridging enquiries at any time from any device using Clever+

Contact the Clever Lending team on

0800 316 2224