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Expenses After Real Estate Auction You Need to Know

Expenses After Real Estate Auction You Need to Know - What costs to consider if you participate in a court auction?

Expenses After Real Estate Auction

When deciding to participate in a judicial auction to acquire a mobile or property asset from seizure or foreclosure, it is advisable to collect all the necessary information regarding not only the auction itself, but also the steps following the eventual award. Not everyone knows, in fact, that there are deadlines and expenses to be incurred following the closing of the race. The points to keep in mind in order not to fail and not to contravene the current legislation can be summarized as follows:

  • How to participate in an enchanting auction
  • What is the difference between provisional and final award
  • What is the transfer decree?

Deadlines and how to participate in an auction

In order to understand in detail the costs of the bidder of a judicial auction, it is necessary to make a small preamble and emphasize the difference between the provisional and final award of an asset. Underlying this fundamental distinction is the fact that more potential buyers may participate in the auction for the same property, each of whom will be free to bid. As a result, it may happen that, although you have expressed your intention to buy a particular asset, you may not be the best bidders. In this case, those who have not won the asset of interest will have to submit a form in a short time requesting the return of the deposit, paid as an advance in the event of a probable payout. This form is delivered to all bidders before it is actually carried out, and must be returned in the event of a non-winning immediately after the sale of the asset to the highest bidder, by the delegate at the sale. In addition to the transfer costs due to the purchase of a property at auction, the new owner must also take into account the necessary payments for the cancellation of the foreclosure or voluntary mortgage. In the first case, the amount of expenditure is 262 euros. If, on the other hand, it is a matter of cancelling the voluntary mortgage, the amount to be paid is 35 euros, to which you must add the 59th of the stamp duty and the 35th of the mortgage tax. Slightly different is the calculation if a judicial mortgage is serious on the property purchased at auction. In this case, a figure corresponding to 0.50 of the amount of the original mortgage registration must be paid for its cancellation.

Asset transfer decree and related economic contribution

If the participation in the tender is successful, the person who has won the asset will have to pay a series of expenses for buying property at auction. Before the sums are paid you are considered only provisional contractors, which means that you do not yet have the actual ownership of the property. After the return of the goats to the non-winning auctioneers, the bidder is called upon to sign the so-called award report. It is a public act, in which the most important information concerning the actual conduct of the auction is disclosed, namely the number of participants, the amount of bids submitted and the data relating to the property sold. The signature of the minutes, which can be withdrawn at a later date at the Chancellery of the Tribunal where the auction was held, represents the final bureaucratic act of the tender. With regard to payments, it should be borne in mind that the 60 days provided to pay the difference between the deposit previously paid and the award price of the asset, take place from the date of the auction. In the 10 days following the tender, the legislation provides for the possibility of submitting bids that are increased by one fifth compared to the award price. In the event of this, the procedure that is followed is to call the provisional bidder, the participants in the first instance not winners and the bidder who raised the award price by a fifth, in order to call a new auction.

VAT on properties purchased at auction: how to do the proper calculations

The period between the payment of the difference between the deposit and the award price and the actual transfer of the asset purchased at auction can extend to up to 2 months. For the transaction to be recognized, you must submit the relevant receipt proving that the payment has been made. At this point, you can request the issuance of the transfer decree, paying a stamp mark worth 14.62 euros. The term transfer decree refers to the act by which the judge in charge of the executions sanctioned the transfer of the previously expropriated property to the new rightful owner. This document also includes an injunction, addressed to the debtor and any custodian, to abandon the property sold. In other words, the transfer decree can be considered in all respects a legal title for the transcription of the sale of the property. This change of ownership involves the new owner paying the transfer fees. In addition to the payment of the branded values, the person who won the auction is required to pay an amount equal to 149 euros for the transcription of the transfer decree. The cost of registering the transfer decree may actually vary substantially, depending on whether the owner is in a position to take advantage of the benefits intended for the first home. In the first case, the amount of the registration fee is 3 of the price at which the property was awarded. If, on the other hand, it is not possible to consider the purchase made as a first home, the percentage rises until it reaches 10. A similar argument must also be made with regard to VAT, which ranges from 4 to 22. Expenses to be incurred following the awarding of an auction should also include condominium costs, relatively not only this year, but also the previous year compared to the auction. The legislation requires that the new owner have to pay the necessary condominium costs for ordinary and extraordinary interventions over the period indicated. However, this does not mean that the auctioneer may decide to claim a refund of these latter expenses incurred by the old owner.

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