Future changes in the market may mean that it will pay to understand a little bit about these kind of sales.
A “mortgagee” is the party who has loaned money to another party, the “mortgagor” (usually the property owner), and who has taken security for that loan over a property owned by the mortgagor.
The mortgagee is usually a bank, institution or finance company, or less commonly, an individual person.
A mortgagee sale arises when the mortgagor follows legal process to exercise its power to recover the debt.
They will often give mortgagors who are in arrears time to negotiate a payment plan, or to sell the property themselves.
A sale is often only put in place when all other avenues have been exhausted to recover the debt.
There are a number of risks associated with mortgagee sales that purchasers should be wary about.(Next newsletter).
Selling “As is – where is”
“As is-where is” means a vendor is selling, and a purchaser is buying property/land in whatever condition it represents at the time of signing the contract.
The licensee will still need to make any disclosures that they are aware of to prospective purchasers, when they show them the property and encourage them to do their own “due diligence”.
Properties and land that are sold in “As is – where is” examples are:
- Mortgagee sales.
- Ones that are badly in need of repair.
- Have illegal occupants.
- Have issues with the title or non-complying structures.
- Have issues with its zoning or locality.