Things to Keep in Mind before Buying

Who Sells Property at Auction?

Several groups choose to use the Auction method of sale, including: Private home or land owners, farmers, timber companies, businesses, private partnerships, lending institutions, governments, churches and many other categories of owners.

What are the types of auctions?

Auctions are not a one-size-fits-all by design. An auction method is chosen for each Seller depending on their needs and the property that is being sold.

Examples of the most common types of auction include: live onsite, online only, simulcast (live and online hybrid), sealed bid, absolute, reserve

How do I register to bid?

To bid on site, bring a valid driver’s license and complete the brief registration form. The process only takes a few minutes. Some auctions may require a bidder deposit to be made in advance of the auction.

This information will be clearly spelled out when you go to register. Don’t forget the cashier’s check or other form of down payment required to bid.

To register online, go to ‡ link

Can I Inspect Before I Bid?

Since purchases are made as-is, where-is, all auctioneers are required to offer a period of inspection.

These times are usually posted online or in some cases a viewing may be scheduled with the Auctioneer.

What is required to bid at Auction?

Auction Buyers should bring Identification, and a cashier’s check or business or personal check accompanied by a bank letter of guarantee or other proof of funds.

What Is A Buyer’s Premium?

Although the buyer’s premium may change from time to time, it is usually 10 percent of the winning bid.

May I use Financing?

While financing is an acceptable means of payment, the transaction is not contingent upon it being awarded and a backup plan should be in place should the financing fall through for any reason.

Will I get clear title?

Yes. The only contingency in real estate auction is a clear and marketable title.

Will I get Title insurance?

It is the Buyer’s option to purchase title insurance. In most cases it is recommended. The buyer will be responsible for all closing costs, including title insurance.

Can I use my own attorney?

Yes. The terms will name a closing attorney/company to conduct the closing of the transaction, for which the Buyer is responsible. If a Buyer wishes to have its own representative review the documents, a Buyer may do so at its own expense.

Is there a reserve price?

Most properties are offered “subject to seller confirmation” (a reserve auction) unless otherwise advertised as “absolute.” Properties sold “subject to seller confirmation” or “reserve” will not have a published reserve price, and the high bid is subject to seller approval.

What does Absolute Auction mean?

Properties advertised as “absolute” have no minimum reserve value and will sell to the highest and best bidder on auction day.

Do I need to use a Real Estate Agent?

If a buyer will be more confident having representation at an auction, the Auctioneer will welcome cooperating with registered agents. Buyer’s representatives will register the buyer as a client, attend the auction, and assume the role of a buyer’s agent.

When will I sign the Contract?

If you are the winning bidder at auction, rather live or online, you will need to sign a purchase and sale contract immediately following the auction.

When will I need to put down the deposit?

Winning bidders will need to submit their deposit upon signing the contract on auction day and may utilize a check or wire transfer to deliver funds.

When will I know if my bid is accepted?

For properties selling with reserve, Buyers will generally have an answer the same day or within 2-3 days.

When is title transferred?

The transaction will generally close within 30 days of the auction. Once funds have been received and all parties have signed the appropriate documents, the Buyer will receive title and possession.

Can I back out of the Contract?

Auction contracts are binding legal documents that cannot be canceled. If a Buyer walks away from an auction contract, they will lose 100% of the deposit money and be subject to legal repercussions.

What is “High Bidder’s Choice”?

In this method of auction, winning bidders will have the right to select from 2 or more lots (properties).

This type of sale is more complex than an auction offering only one property so it is important to discuss the details well in advance of the sale with the Auctioneer.

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