The nightmare auction purchase mistake-avoid this blunder

Want to pick up a bargain at an online property auction? Avoid this mistake.

A commenter on my YouTube channel recently expressed shock at the position he finds himself in. He had bought a property at auction and he has now discovered that he will not be getting vacant possession of the property as there is a tenant in the property.

He contacted his solicitor who told him that it was his (the commenter’s) problem and he must get a court order to evict the tenant. 

Here is the comment:

hi.terry.i bought an action house.psid the deposit.there is a issue .the house is owned by Finsbury Circle Nominee Ltd with tenant of previous owner who claim still own the property.the court case between them was should i solicitor told me its my problem now to go to get court order to get rid of the ‘tenant’.i am come is my problem now.according vacant i have right if the vendor couldnt vacate the house by the date.i should gey my money back and whatever the cost other damage

The commenter is asking how is it his problem to get vacant possession by evicting the tenant. That’s an easy question to answer, quite frankly. The likelihood is the contract and documents of title which were made available prior to the auction would have made it clear that there was a tenant and the purchaser is on notice of the situation.

Therefore, the problem after purchasing the property lies with the purchaser.

I have reviewed title documents and contracts of sale for a good deal of properties being sold at auction, whether it is a BidX1 auction or BRG, or whoever is conducting the auction. And I have come across many properties with sitting tenants. 

The receiver or liquidator, as is typically the case, will have little or no information about that tenant because the receiver will have been appointed by the bank on foot of their mortgage/charge on the property. It will usually be a buy to let investment which has gone wrong and the borrower is unable to continue repaying the mortgage.

The occupation of the premises by a tenant and the limited information about the nature of the letting,how long it has gone on, deposit paid or not, monthly rental, and so forth will be made known in the documents of title and/or contracts. It would be a difficult thing to conceal-let’s face it-especially when potential buyers would want to carry out inspections of the property.

Once the potential bidder is put on notice of the situation prior to the auction he buys the property on those terms and in possession of all the facts.

The commenter who was asking the question on my YouTube channel, I assume, did not instruct a solicitor prior to the auction to review the contracts and title documents. If this happened the occupation of the tenant would have been discovered and the bidder could decide whether to proceed with the bidding or not.

Now, because he has been the successful bidder, the commenter is obliged to complete the sale and deal with the tenant in due course.


I have repeatedly advised anyone who is thinking about trying to pick up a bargain at an auction, whether online or in the flesh, to have the contracts and title documents reviewed prior to the auction. Not doing so is such a silly, avoidable blunder that it is hard have a tremendous amount of sympathy for such a buyer.

Nevertheless, I do have sympathy for anyone who finds themselves in this situation. The property might well prove to be a bargain, and may be a superb investment in the medium to long term.

But in the meantime the sale must be completed and the tenant must be dealt with lawfully, unless the vendor is prepared to let the buyer off the hook. This could involve forfeiting the contract deposit, though.