How to Buy a House for Sale from Foreclosure?

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You have decided to buy a house from the foreclosure due to its affordable price. But you don’t know how to act, the paths you should follow. Here is the path to be followed to buy a house for sale from the execution…

It is  a profitable investment tool as the foreclosure houses are sold well below the market value. The initial tender opening price is 50 percent and it is a great opportunity to own a house with 50 percent profit in today’s conditions.

In order to take advantage of this opportunity, you must be aware of real estate auctions for execution.

The most comfortable way to do this is to follow the executive announcement sites on the internet.

HOW TO BUY A HOUSE FROM THE EXECUTION?

Goods such as flats, land or cars that are sold by the execution method are auctioned and sold by the auction method. If you want to buy a house from the foreclosure, a lawyer who is expert in his work needs to do a detailed research.

The houses that go into execution are put up for sale by the executive director or his assistants, by announcing the auction letter, on the day of sale. If you want to buy real estate in this way, you must be over 18 years old.

In addition, at the time of sale, you must keep 20 percent of the amount specified in the tender in advance. 

There is VAT to the state for the houses you will buy with an amount far below the market price. While the VAT rate is announced as 18 percent for houses of 150 square meters, it is 1 percent for apartments under 150 square meters. There are also stamp duty, broker’s fee and other expenses.

IF YOU WIN THE TENDER

After winning the tender, the full amount of money must be paid within 10 days, unless an appeal or annulment case is filed.

 Then, a letter must be sent to the land registry office for the title deed specified by the enforcement office.

At the same time, the real estate purchased through tender cannot be sold within 3 years from the date of sale in accordance with the Income Tax Law. If the real estate is sold, income tax must be paid as much as the difference.

IS IT PROFITABLE TO BUY A HOME FROM THE EXECUTIVE?

It is very difficult to buy a house in our country. Flats in execution are sold around 40 percent below their peers. A 500 thousand lira flat can be sold for 300 thousand lira in the execution tender.

WHO CAN PARTICIPATE IN THE EXECUTIVE TENDER? WHAT IS THE GUARANTEE?

Anyone over the age of 18 can participate in the execution tender. The only condition is that 20 percent of the house to be purchased is kept as security or deposited into the account of the relevant enforcement office.

If you cannot buy the house as a result of the tender, your guarantee will be returned without any interruption. If you win the tender, you can perform the deed transactions of the house by depositing the money that is not covered by the guarantee.

For example, for a house with an estimated value of 500 thousand liras, you need to deposit 100 thousand liras as collateral.

The approximate value is the market value of a movable or immovable property, which is planned to be sold by way of tender, determined by the expert according to the market conditions.

CAN I BUY THE EXECUTIVE HOUSE WITH LOAN?

Banks are reluctant to give loans to foreclosure houses. The reason for this is that even if the tender is won, a lawsuit for termination of the tender may be filed.

If you are participating in the tender, the entire bid must be in cash.

SPECIFICATION MUST READ WELL

It is necessary to read and understand the specifications prepared by the enforcement office regarding the tender. “Is there a shared residence or an annotation” should be paid attention to.

WHAT IS THE CASE FOR TERMINATION OF THE TENDER?

Even if you win the executive tender, you may face a lawsuit afterwards. The case for the annulment of the tender is opened with the allegation that the bidders have irregularities in the tender. The opening period is 7 days from the date of the tender.

The enforcement court will hold a hearing within 20 days. A lawsuit for the annulment of the tender is filed for reasons such as rigging the tender, preventing those who will participate in the tender, keeping the information about the property to be held confidential.

In general, enforcement offices act meticulously to prevent irregularities.

HOW DOES THE AUCTION SYSTEM WORK?

Before the tender is opened, the valuation of the current value of the house is made. For example, the flat with a market value of 380 thousand liras is opened to tender for 198 thousand liras.

If the bid is 50 percent lower than the estimated value of the house in the first tender, the sale is not made and the tender is repeated for the second time 10 days later by the same executive office.

The bidder above 50 percent of the estimated value of the house wins the tender. In order to avoid this situation, enforcement offices generally open the tender at prices slightly above 50 percent of the houses.

IS THE PAYMENT MADE TO THE EXECUTIVE OFFICE?

In executive tenders, the person who purchases the goods has to pay VAT, stamp duty and similar expenses as a teller on the tender price, in addition to the sales price. In addition to all these, the winner of the tender pays the title deed costs.

POSSIBLE TO DEFINE AUTOMATIC OFFER

You can participate in the tender without going to the executive office. If you use the automatic bidding option in the UYAP system, you can enter the tender without going to the tender.

For example, if you open the automatic bid option up to 300 thousand liras in the tender opened from 250 thousand liras, you can make the purchase by paying 276 thousand liras, even if the tender ends at 275 thousand liras.

HOW TO USE UYAP’S SITE?

After becoming a free member of UYAP’s e-sales system, you can select options such as movable, immovable, vehicle and look at the desired addresses or immovables with the desired properties. All information about the tender can be viewed by looking at its details.

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