What happens if I cause the seller to lose money?
If you fail to complete the purchase after successfully bidding at auction, not only will you lose your deposit — you may also be liable for the seller’s financial losses.
Why?
When the auctioneer’s hammer falls, you are legally bound to buy the property under the terms set out in the auction legal pack. If you later breach that contract by not completing, the seller has the right to:
- Keep your 10% deposit
- Claim compensation for any additional losses they suffer as a result of your breach
Examples of what you may have to pay
If the seller resells the property after you default, you could be liable for:
- The difference in price if the property sells for less than your winning bid
- Legal and auction fees they incur for re-listing the property
- Interest and holding costs if they face delays in completing another transaction
- Any other direct losses, such as abortive costs for their onward purchase or mortgage arrangements
These claims can run into thousands of pounds, and there is no upper limit set by law — it depends on the actual financial loss the seller can prove.
Legal action
The seller may issue court proceedings to recover their losses. If successful, the court may:
- Order you to pay compensation
- Enter a County Court Judgment (CCJ) against you
- Add interest and legal costs to the amount you owe
A CCJ can seriously damage your credit rating, making it difficult to get a mortgage, credit card, or loan in the future.
Key warning
- You will lose your deposit
- The seller may take legal action against you, and you could face:
- A County Court Judgment (CCJ)
- Additional legal costs
- Negative impact on your credit rating or ability to borrow in the future
- You may also be liable for further losses the seller suffers, such as:
- If the property has to be re-sold at a lower price
- The seller’s additional legal or auction fees
- Administrative or holding costs
Summary
The deposit is just the beginning. If you fail to complete, you may have to pay far more than 10%. The seller can — and often will — pursue you for every penny they lose as a result of your default.
If you’re not 100% certain you can proceed with the purchase, you should not bid.










