Frequently Asked Questions
Below you will find a selection of questions that can help you with your general questions about auctions for buyers and sellers.
A: Buying real estate at an auction is a very simple process. However, it is important for you to be informed and prepared prior to auction day. You should inspect the property during one of the scheduled preview dates.
Q: What is the asking price for properties?
A: All of our auctions are conducted utilizing the Open-Cry bid system. There is no beginning asking price. A starting bid comes from qualified bidders who attend the auction.
Q: What are the advantages of buying real estate at auction?
A: All of our auctions are Open-Cry type auctions, meaning that the auctioneer asks for each bid, and the bidders simply signal the auctioneer that they accept. Since this is open for everyone to see, there is an inherent honesty to the process. You are only competing against the other market bidders, and you will not overpay. Buying real estate at an auction allows you to experience a quick purchase and closing, to eliminate lengthy negotiations and to secure the market value was paid.
Q: Why are properties sold at auction?
A: The speed of the marketing process is the number one reason people choose an auction sale. Owners make a wise business decision to sell property in a one-day sale rather than continuing to carry costs associated with conventional marketing. Sellers are motivated to sell, and they offer buyers an opportunity to purchase desirable property at a substantial discount. Over 90% of properties offered at auctions are sold.
Q: How are auctions conducted?
A: Most auctions are conducted by open bidding. As a bidder, all you need to do is hold up your bidder card and call out your bid, or tell one of the bid assistants what amount you want to bid. The bid assistants are there to help you.
Q: Do I need to be represented by a real estate broker in order to buy at the auction?
A: No. We do encourage buyer-broker participation; however, it is not a requirement.
Q: Can I make an inspection of the auction properties prior to the auction?
A: Yes. All of our auction properties have an inspection date posted on the property page and in marketing materials. We strongly encourage you to view the property, as you will be purchasing it “As Is, Where Is.” However, properties that remain occupied by tenants are not typically shown. Vacant land properties may be viewed anytime without supervision; although, we will have a representative on-site on specific dates.
Q: Is financing available?
A: Some auctions have financing available, while others do not. See the information listed in your specific auction catalog to determine this.
Q: How long do I have to get financing after the auction?
A: If financing is required to complete a purchase, we suggest you arrange and pre-qualify with a lender prior to the auction date. If you fail to pay the balance due by the closing date, you forfeit your bid deposit.
Q: What is required in order to bid at an auction?
A: You must register with a valid ID (Driver’s License) on auction day and receive a bidder card in order to bid. If you are the highest bidder for a property, you will be required to make a bid deposit on auction day. This amount is posted on the property page of the web site and in the brochure.
Q: Can I buy more than one property?
A: Yes. You just need to bring and present a separate check for each property you intend to purchase.
Q: What does “absolute auction” mean?
A: Real estate being sold “absolute” means the property will be sold to the highest bidder, regardless of the high bid price.
Q: What do the terms reserve and absolute mean?
A: An auction where the property is being sold with a reserve means that the property is being sold subject to seller confirmation. We try to make sure that the reserve is reasonable and that the seller is very motivated to sell at the high bid achieved, regardless of the reserve amount. When a property is being sold absolute, it will be sold to the highest bidder regardless of the price.
Q: Before closing, do I have to make any additional deposits other than my bid deposit?
A: No. The bid deposit is a non-refundable deposit, and it is usually an amount that we feel comfortable will assure the buyer will close. The bid deposit is held in escrow and is deducted from the total purchase price, equal to the bid amount plus the buyer’s premium.
Q: What happens once I have become the successful high bidder?
A: You will move to the contract table where you will present your check for the bid deposit and complete the sales agreement.
Q: What is a buyer’s premium?
A: A buyer’s premium is a percentage paid by the buyer and added to the highest successful bid to determine the final contract price. If a premium is being utilized, it will be detailed in the auction catalog.
Q: To whom do I talk to if I don’t understand the auction contract?
A: It is very important for auction buyers to be educated and informed regarding the auction process. Make sure all your questions and concerns are answered before you attend an auction. The contract is available by contacting our offices. Feel free to have your legal advisor review the contract prior to the auction date.
Q: Is my deposit refundable if I change my mind after the sale and decide not to buy the property?
A: No. If a buyer does not close for any reason on or before the closing date, the initial deposit is automatically forfeited.
Q: When and where are closings held?
A: Closings generally occur within 30 days after an auction. Since the seller typically pays for title insurance, a company has been selected and will be provided to you in the contract room.
Contact Us Today!
Want to have an auction? Need to consign items in our next auction? Interested in some of our Property For Sale? Please feel free to contact us to discuss your specific needs.