| RealEstateAuctionByOwner.Com DBA ULTIMATE AUCTIONEERS |
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| How To Buy Real Estate At Auction |
| The purchase of real estate is exactly the same as whether you buy it at auction, or in any traditional manner. The format for property transfers is the same. The purpose of the actual auction is to find the true market value of any property, extract the cash value of that property for the seller, and accelerate the time it takes to sell the property. |
Buyers are generally required to produce a monetary deposit in order to be allowed to bid at a real
to actually purchase a property. This deposit is the applied to the partial payment towards the
property, otherwise normally referred to as the escrow money. If the bidder is not successful in
obtaining a property, the funds are returned to that bidder upon the bidders return of the unused
bidders number.
Upon the release of the required deposit, the bidder will be issued a bidders number. The bidder
will be responsible for all bids offered by that number. Do not lend your bidders number to anyone
else. The number is printed in large print on a card, or paddle of some type.
The auctioneer will ask for a bid on the property. If no bid is offered, he will usually lower his asking
bid amount until a bid is offered. When a bid is received, the auction will then ask for another bid
higher than the first one. This continues until the final and highest (the auctioneer may use the
word "best") bid is received. This is when no more bids are offered. The auctioneer will determine
the acceptable increase amounts of the bids.
If the auction is advertised as an ABSOLUTE AUCTION, the auctioneer will state the property is
SOLD! An Absolute Auction means that the property is being sold to the highest bidder
REGARDLESS of the price.
If the property is advertised as a RESERVED AUCTION, one of two announcements will be made by
the auctioneer. A Reserved Auction means that the property can not be sold unless the highest bid
is at least as high as a minimum selling price agreed to, prior to the auction, by the seller. Reserved
Auctions are common place, and should be considered a fantastic opportunity to purchase real
estate, so long as the bidder has some expectation of buying the property at a price below the
normal fair market value. The auctioneer may state the property is SOLD!..... because the highest
bid is at least as high as the minimum reserved selling price. If the minimum selling price has not
been met, the auctioneer will announce that fact to the bidders. He may, at his discretion, then
announce the minimum selling amount and give the bidders the option to raise their bids. If no
bidder is willing to bid the minimum reserved selling amount, the owner is under NO obligation to
sell the property.
SOLD SUBJECT TO SELLER APPROVAL, means that the seller reserves the right to accept, decline,
or counter offer with a different price or terms. In this case, the buyer has NOT been awarded the
final sale of the property unless the seller accepts the bid amount. This is the normal procedure for
properties such as "foreclosure" or REO Properties. All bidders must allow time for the seller to
consider the offer.
When a bidder is successful with a acceptable highest bid, he is then under legal, contractual
obligation to buy the property. The seller is also under legal, contractual obligation to sell the
property, subject to the conditions of the type of sale.
The bidder will be required to release the bidder deposit amount and possibly an additional amount
to reach the required escrow amount for that property. All Real Estate Purchase Agreements will be
executed by buyer and seller. From that point forward, the process of closing is identical to any
traditional real estate purchase.
to actually purchase a property. This deposit is the applied to the partial payment towards the
property, otherwise normally referred to as the escrow money. If the bidder is not successful in
obtaining a property, the funds are returned to that bidder upon the bidders return of the unused
bidders number.
Upon the release of the required deposit, the bidder will be issued a bidders number. The bidder
will be responsible for all bids offered by that number. Do not lend your bidders number to anyone
else. The number is printed in large print on a card, or paddle of some type.
The auctioneer will ask for a bid on the property. If no bid is offered, he will usually lower his asking
bid amount until a bid is offered. When a bid is received, the auction will then ask for another bid
higher than the first one. This continues until the final and highest (the auctioneer may use the
word "best") bid is received. This is when no more bids are offered. The auctioneer will determine
the acceptable increase amounts of the bids.
If the auction is advertised as an ABSOLUTE AUCTION, the auctioneer will state the property is
SOLD! An Absolute Auction means that the property is being sold to the highest bidder
REGARDLESS of the price.
If the property is advertised as a RESERVED AUCTION, one of two announcements will be made by
the auctioneer. A Reserved Auction means that the property can not be sold unless the highest bid
is at least as high as a minimum selling price agreed to, prior to the auction, by the seller. Reserved
Auctions are common place, and should be considered a fantastic opportunity to purchase real
estate, so long as the bidder has some expectation of buying the property at a price below the
normal fair market value. The auctioneer may state the property is SOLD!..... because the highest
bid is at least as high as the minimum reserved selling price. If the minimum selling price has not
been met, the auctioneer will announce that fact to the bidders. He may, at his discretion, then
announce the minimum selling amount and give the bidders the option to raise their bids. If no
bidder is willing to bid the minimum reserved selling amount, the owner is under NO obligation to
sell the property.
SOLD SUBJECT TO SELLER APPROVAL, means that the seller reserves the right to accept, decline,
or counter offer with a different price or terms. In this case, the buyer has NOT been awarded the
final sale of the property unless the seller accepts the bid amount. This is the normal procedure for
properties such as "foreclosure" or REO Properties. All bidders must allow time for the seller to
consider the offer.
When a bidder is successful with a acceptable highest bid, he is then under legal, contractual
obligation to buy the property. The seller is also under legal, contractual obligation to sell the
property, subject to the conditions of the type of sale.
The bidder will be required to release the bidder deposit amount and possibly an additional amount
to reach the required escrow amount for that property. All Real Estate Purchase Agreements will be
executed by buyer and seller. From that point forward, the process of closing is identical to any
traditional real estate purchase.
| Recommendations To Buyers |
Selecting the AUCTION COMPANY that you buy real estate through is an important factor.
Is the auction company "buyer friendly"? Do they provide all the tools and information you need to
make a comfortable and intelligent purchase? Do they have a support staff of independent
associates capable of answering the questions not related to the auction process?
We strongly advise to NEVER bid on any property which does not include title insurance. We do not
register any property without title insurance to guarantee the buyer an encumbrance free
ownership of the property. You should be clear of any previous indebtedness of the property. NOT
ALL FORMS OF AUCTIONS have this benefit.
CHECK OUT THE PROPERTY!! Generally all property sold at auction is sold AS-IS. It is also sold with
NO CONTINGENCIES. That means you must close on the property (complete the transfer to you)
within the alloted time frame. You MUST have the funds or the financing arranged to close on time.
If for any reason you fail to close due to some fault of yours, you will lose your escrow money (just
as in any other type of sale). You should have the right to perform a home inspection at your own
cost, prior to the auction. Check out the surrounding area for any objectionable factors. Always
remember..... DUE DILIGENCE (performing all research regarding the property) IS THE BUYERS
SOLE RESPONSIBILITY! ! Know what you are buying. There is no second chance once you offer a
bid.
Make sure a licensed title/escrow company is acting as closing agent. That person will have a
responsibility to you as a buyer to insure a safe, legal transfer of the property to you.
Internet bidding is a very accommodating manner to buy property. However, caution should be
used to verify true bids by other Internet bidders. You need to be confident that the auction
company has the proper safety mechanism to prohibit insincere bids from being offered. You do
not want to have your bid increased by someone who is not willing, and able to fulfill their
obligation. We incorporate a verification system guaranteeing the required bidders deposit and
immediate execution of all Real Estate Purchase Agreements by all Internet bidders.
Is the auction company "buyer friendly"? Do they provide all the tools and information you need to
make a comfortable and intelligent purchase? Do they have a support staff of independent
associates capable of answering the questions not related to the auction process?
We strongly advise to NEVER bid on any property which does not include title insurance. We do not
register any property without title insurance to guarantee the buyer an encumbrance free
ownership of the property. You should be clear of any previous indebtedness of the property. NOT
ALL FORMS OF AUCTIONS have this benefit.
CHECK OUT THE PROPERTY!! Generally all property sold at auction is sold AS-IS. It is also sold with
NO CONTINGENCIES. That means you must close on the property (complete the transfer to you)
within the alloted time frame. You MUST have the funds or the financing arranged to close on time.
If for any reason you fail to close due to some fault of yours, you will lose your escrow money (just
as in any other type of sale). You should have the right to perform a home inspection at your own
cost, prior to the auction. Check out the surrounding area for any objectionable factors. Always
remember..... DUE DILIGENCE (performing all research regarding the property) IS THE BUYERS
SOLE RESPONSIBILITY! ! Know what you are buying. There is no second chance once you offer a
bid.
Make sure a licensed title/escrow company is acting as closing agent. That person will have a
responsibility to you as a buyer to insure a safe, legal transfer of the property to you.
Internet bidding is a very accommodating manner to buy property. However, caution should be
used to verify true bids by other Internet bidders. You need to be confident that the auction
company has the proper safety mechanism to prohibit insincere bids from being offered. You do
not want to have your bid increased by someone who is not willing, and able to fulfill their
obligation. We incorporate a verification system guaranteeing the required bidders deposit and
immediate execution of all Real Estate Purchase Agreements by all Internet bidders.