Why 28 days is tight
Mortgage lenders typically take weeks to value, underwrite and instruct solicitors. Auction contracts do not wait. If you miss the completion date, you can lose your 10% deposit and face further claims from the seller.
Modern method of auction sales usually allow longer, often 56 days, but carry their own reservation fees. Always read the auction terms.
Auction properties are often sold quickly for a reason: probate sales, repossessions, short leases, structural issues or properties needing full refurbishment. Some are bargains, others have problems that make normal mortgages unsuitable. Understanding why a property is at auction helps you plan the right finance.
Common reasons auction purchases go wrong
- Bidding without checking the legal pack.
- Underestimating fees added in the special conditions.
- Relying on a lender that cannot meet the deadline.
- A short lease or title issue the lender will not accept.
- No buffer for a down valuation.
Each of these can be avoided with preparation. Most auction houses publish legal packs well before the sale date, giving time for checks.
Before the auction: your 7-step plan
- Speak to a broker early and agree a lending budget and maximum bid.
- Get a decision in principle from a bridging lender that understands auctions.
- Read the legal pack with your solicitor: title, searches, leases and special conditions.
- Check extra costs in the conditions, such as buyer's premiums and seller's legal fees.
- View the property or arrange a survey if possible.
- Plan your exit: refinance onto a mortgage, or sell.
- Have your deposit ready, plus funds for fees and stamp duty.
After the hammer: days 1 to 28
- Day 1: sign the contract, pay the deposit, confirm the purchase to your broker.
- Days 1 to 5: submit the full application and pay for the valuation.
- Days 5 to 15: valuation, underwriting and legal work run in parallel.
- Days 15 to 25: offer issued, solicitors finalise and request funds.
- By day 28: completion.
Timings vary with the property and how quickly documents are supplied. Using a solicitor experienced in bridging helps.
How much can I borrow?
Bridging lenders typically lend up to around 70% to 75% of value, sometimes more with extra security. Interest is usually charged monthly and often "retained" or "rolled up" in the loan, so you do not pay monthly. Our bridging calculator shows how costs build up. If the property is unmortgageable, such as one without a working kitchen, bridging is often the only route.
Lenders base the loan on their own valuation, not the hammer price.
What will the lender need from me?
- Identity and address documents.
- Proof of deposit and funds for costs.
- The auction legal pack and contract.
- A clear exit plan with supporting evidence.
- Details of any refurbishment and costs.
- Your property experience and other assets and liabilities.
Having these ready before auction day can save several days.
What does auction finance cost?
Bridging is expensive short-term borrowing. Expect monthly interest, an arrangement fee, valuation and legal fees for you and the lender, and often an exit fee. Costs rise the longer you keep the loan. Factor them into your maximum bid alongside stamp duty, including the 5% surcharge for additional homes in England.
What exit will lenders accept?
Bridging lenders focus on how you will repay. The two common exits are refinancing onto a longer-term mortgage, such as buy-to-let, or selling the property. If you plan to refinance, check that the property will be mortgageable once works are done, and that rental income will pass the new lender's stress test. If you plan to sell, show local sales evidence and a realistic timetable.
Terms are commonly up to 12 to 18 months. Planning your exit before you bid reduces the risk of costly extensions.
What are the risks?
- A valuation below the hammer price means a bigger shortfall to fund.
- Legal problems in the pack can delay completion.
- If your exit fails, refinancing or extending can be costly.
- The loan is secured, so the property could be repossessed.
Bridging secured on a property you or your family will live in is regulated by the FCA. Investment bridging is usually unregulated. See how bridging works for more detail. OMB can arrange a decision in principle before auction day.
Bridging loansFast, short-term property finance for auctions, chain breaks, refurbishments and time-critical purchases.
Explore bridging loansFrequently asked questions
How long do I have to complete after an auction?
At a traditional auction, usually 28 days from exchange, which happens when the hammer falls. Some contracts set a different date. Modern method of auction sales often allow around 56 days. Always check the special conditions in the legal pack.
Can I use a normal mortgage to buy at auction?
Sometimes, if you arrange it well in advance and the lender can meet the deadline. Many buyers use bridging instead because it is faster and more flexible, then refinance onto a mortgage once the purchase completes. Ask your lender to confirm its timescale in writing before you bid.
What happens if I cannot complete on time?
You are likely to lose your 10% deposit and may be liable for the seller's losses and costs. This is why arranging finance before you bid is essential. In some cases a short extension can be agreed with the seller, but this usually costs money and is not guaranteed.
Can I get a bridging loan for an unmortgageable property?
Yes. Bridging lenders often lend on properties without working kitchens or bathrooms, or needing structural work. You will need a clear plan to refurbish and refinance or sell within the loan term. Lenders will want to see a costed schedule of works and evidence you can deliver it.
Is auction bridging finance regulated?
It is regulated if the property will be lived in by you or a close family member. Bridging for investment or development is usually unregulated, which means fewer consumer protections. Bridging is expensive short-term borrowing, and the property may be repossessed if you do not repay.
How much deposit do I need for auction finance?
You pay a 10% deposit on auction day from your own funds. Overall, bridging lenders typically lend up to 70% to 75% of value, so expect to fund the remainder plus fees and stamp duty. Keep a cash buffer for valuation shortfalls.
Important: This guide is general information, not personal advice. Rules, rates and lender criteria change; speak to an adviser about your circumstances. Your home may be repossessed if you do not keep up repayments on your mortgage.