Info and experiences with 'Zwangsversteigerung'

55 posts in this topic

Posted

We have finally decided to buy a house and are looking into all possible options including that of forced sales where we understand that if you are lucky you can get them at a good discount. so has anybody done this? where did you get your info? did you subscribe to a catalogue? and was it a good deal? any info would be greatly appreciated.

thanks

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Posted

They can be a good deal, but have your financing ready and go to the neighborhoods that you would like to live in. There is a list of these things at some amt or other. I have seen it on a website, but can't remember what the address was.

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Posted

You can search for forced sale auctions in a particular area here. It's an interesting topic. You MIGHT get a good deal, but not always. Like any auction, it depends on the level of interest in a particular property. One of my neighbours will shortly have his house sold by such an auction. As an interested party (we share some common facilities) I was involved in the valuation, and invited to comment on it. The valuation seemed pretty fair, so there was little comment to be made. It's not clear to me if this valuation was simply a guideline, or will be used as a reserve price for the auction. The valuation agent told me the best deals are on run-down properties or areas where the new owner is willing to invest more money or time on sorting the place out...

YL6

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Posted

Round my way (Augsburg) it works like this:

They get the valuation which is supposed to reflect a standard open market price. So it's not really a "guide" price as such for the auction 'cos it will probably be too high in reality.

Then at auction once the price bid exceeds 75% of this valuation then a sale will legally go through (the seller e.g. the bank cannot refuse it). So of course it could finally go for 80% or 120% but either way once above 75% someone is gonna get it.

Between 50% and 75% it is up to the seller if he wishes to accept (the bank usually!).

To be allowed to bid you need to put up 10% on the day in cash or bankers draft. Once deal is done you get normally up to 2 months to pay.

Just my experience so far - I have actually been and bid on something earlier this year.

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Posted

That about summarises what I know too. The determination of the guide price is quite complicated and may, or may not have anything to do with market value. All manner of people can influence the "valuation", depending on their interest in the sale. You do get time to pay, but you also have to pay nominal interest on the amount... I understand that banks rarely force a sale, unless their customer has done a runner. Most auctions like this are forced by the taxman...

The site I referred to earlier also has a brief FAQ on the subject, which you can read in (badly!) translated form here

YL6

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Posted

Thanks a lot guys.

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Posted

Hi guys,

I am thinking of buying a flat and I hear that you can get really great deals if you go to these Zwangsversteigerung events, which are basically auctions on flats, which have been repossessed by Banks.

Does anyone have any experience with this sort of thing?

How trustworthy are these events?

How long does it take before the flat is actually vacant?

Any tips or hints would be highly appreciated..

Cheers,

M.

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Posted

This has been discussed before, but not specifically for NRW. There is no hard and fast rule on vacancies because every home being auctioned is it's very own drama of lawyers, owners, banks, and so on. Be prepared to do a lot of research on the process, the local laws, and the properties; you have to think of everything. When you say "trustworthy," you probably want a guarantee-- you definitely won't get a guarantee, it's buyer beware. Also, you might get a great deal, or you might be outbid on people who want it more than you for whatever reason, or don't know what they're doing.

There are helpful books available on the topic (in German- if you aren't totally fluent, I wouldn't recommend going this route at all).

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Posted

We considered trying this route before buying our own place. However we have a friend who is a lawyer specializing in property law and he advised against it strongly. You can get into a whole lot of pain and misery buying such a place. You have no guarantee that the tenants will go peacefully or that they will leave at all.

Granted we looked into this a couple of years ago, so laws may have changed but do take the time to investigate and research the property and where you stand exactly if you buy somewhere with tenants in-situ!!!

You can get good deals but be prepared in case it goes pear-shaped.

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Posted

...but either way once above 75% someone is gonna get it.

Between 50% and 75% it is up to the seller if he wishes to accept (the bank usually!).

To be allowed to bid you need to put up 10% on the day in cash or bankers draft. Once deal is done you get normally up to 2 months to pay.

Anyone know the law on selling the place before the 2 months are up for a big profit?

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Posted

Anyone know the law on selling the place before the 2 months are up for a big profit?

Notwithstanding capital gains taxes that might be due on the profit following re-sale, there are no restrictions on re-sale, once your sole ownership has been registered.

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Posted

And if you lived in the house, even for a short time (I think), there are no capital gains taxes. We bought a flat and sold it for a profit 12 months later (as we bought a house) and as it was our residence, we were not charged any capital gains tax.

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Posted

*I think* that used to be the case up until January 2009 when they brought in the Abgeltungssteuer. Meaning that the property is only exempt from capiatl gains tax if you've had it for at least 10 years.

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Posted

Correct - 26.4-28% of the profit, depending on your religious affiliation, if any...

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Posted

Oh really? Thanks for the info. That poxy church tax strikes again...

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Posted

How can you know if the apt has tenants or not? Has anyone had more recent experience about this?

THanks!

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Posted

*I think* that used to be the case up until January 2009 when they brought in the Abgeltungssteuer. Meaning that the property is only exempt from capiatl gains tax if you've had it for at least 10 years.

Correct - 26.4-28% of the profit, depending on your religious affiliation, if any...

do you still pay Abgeltungssteuer on properties that you've owned less than 10 years, lived in, but bought before January 2009?

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Posted

Law hasn't really changed for property:

http://en.wikipedia...ins_tax#Germany

Germany has introduced a very strict capital gains tax for shares, funds, certificates etc. in January 2009 (called as Abgeltungsteuer in German). Capital gains tax will only apply to financial instruments (shares, bonds etc) if they have been bought after 31.12.2008. Instruments bought before this date are capital gains tax exempt (assuming that they are held for at least 12 months), even if they are sold in 2065 or later, barring a change of law. Special treatments of certificates, which only qualify for tax exemption if they have been bought before 15.03.2007.

Real estate will still be free of capital gains tax if held for more than ten years. The German capital gains tax will be 25% plus Solidaritätszuschlag (add on tax to finance the 5 eastern states of Germany - Mecklenburg-Western Pomerania, Saxony, Saxony-Anhalt, Thuringia and Brandenburg - and the cost of the reunification) plus Kirchensteuer (church tax) effectively coming to about 28%. No deductions of cost like custodian fees, travelling to and from annual shareholder meetings, legal and tax advice, interest paid on loans to buy shares etc. will be allowed any more from 2009 on.

do you still pay Abgeltungssteuer on properties that you've owned less than 10 years, lived in

You never do and never did for the #1 primary home that you live in. Same as ever. 1st regular home you live in is untaxed.

When you say "lived in"....do you mean....up to the point of sale??

Makes all the difference. If it is your regular home, and not rented....then tax free as ever...regardless of any 10 year rules.

If it was your regular home, but now rented...then taxable if held less than 10 years.

You might need to be more specific?

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Posted

No tax on any profits then. If you can make a profit with property in this country!!

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Posted

A question about the Zwangsversteigerung. There is a house near us we are interested in and we have been working with the bank to understand the Zwangsversteigerung process. One thing they recommended is that we get a lawyer because the couple that were the previous owners (and went bankrupt, or comparable), weren't cooperating with the bank and likely won't leave amicably.

We are checking with our broker to see if our Rechtsversicherung would cover this situation. Does anyone know what it might take to evict the couple that is in the house? Especially important is how long it could take, but also what is the process.

Thanks!

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Posted

Nasty stuff. If the auction goes through they have to leave. How long it takes, and what rights they have are good questions. Could even be that they are working with other banks to hold on to the property. There is a case near us now. Nasty, nasty stuff.

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Posted

Remember too that if the bank is forcing the auction they are only interested in recovering the money they have lent. If they have loaned 200k€ on a house that sells for 300k€ then although the purchaser becomes legal owner of the house, the old owners get a financial windfall of 100k€ with which they can fight future legal action. This is not usually the case, however - most forced auctions result in the bank not recovering their debt (or at least debt plus accumulated costs, which may include many months of unpaid interest).

Rechtsschutzversicherung is unlikely to help you as many such risks in purchasing a new property are particularly excluded (§ 3 Abs. 1 lit. d ARB)

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Posted

with which they can fight future legal action

So, what would the legal fight be? What kind of legal basis or precedence is there? Is there a chance that they could become long-term squatters? (I'm assuming yes, I just wonder how long it might take to get them out.) Do they have any legal rights in this situation?

Okay, all questions. I would think that they have some rights, and that there is likely some time required to officially evict them so that they can take all property that is "there's" with them. I just want to get an idea of how long that might be and what they can do to stall.

Thanks!!

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