What happens if you don't complete on time when buying at auction?
When you bid for a property and your bid is accepted you have made a commitment to purchase; to all intents and purposes the property has been sold to you and you will have to pay a 10% deposit at the point of sale. If you fail to complete by deadline date, the vendors solicitor will give you a Notice to Complete; usually a further 10 days in which to complete the purchase. That is effectively your last warning, your yellow card.
You can be charged a daily rate of interest from the deadline day onwards, so the clock is now ticking and having a direct impact on your bank account!
At the expiry of that notice period the vendor can withdraw from the sale and retain your 10% deposit as you failed to perform. That is your red card.
The vendor retains the right to claim further costs from you, for instance, if they subsequently sell it for a lower price that you contracted to pay.
Most auctions give you 28 days to complete (some more, a few less) and, if you're using bridging finance, this is well within your grasp. Always providing you are using a solicitor who understands the speed required in this kind of transaction.