Taking part in an event held by RealEstateAuctions.com is easy. Here’s how to bid at real estate auctions:
Before The Event
- Preview any and all properties of interest on any of the Open House dates that will be held prior to the auction.
- Carefully review the disclosures provided for each property, the Terms and Conditions, and the sales contract. Be sure you understand all the documentation. Seek the services of an attorney, if appropriate.
- Get a financing commitment (pre-approval) from a lender if you will not be paying cash. Waiting to do this crucial step after you purchase could result in denial and loss of earnest money. A lender will be available at the auction event if you have not yet secured a pre-approval, but it is highly recommended you not wait until this point to check. You might not qualify for financing. If you’re not qualified for financing, you’ll be unable to bid.
- Register on our website as a bidder. We’ll also take registrations at the door on the day of the event, but you’ll save yourself considerable time by registering online. If registering at the door or checking out financing with the on-site lender, be sure to arrive early.
At The Event
Check in at the registration table with the following:
- Driver’s license, state photo ID or passport.
- A cashier’s check in an amount specified for each property you intend to bid on (the monetary amount varies per property).
- Personal check to supplement the cashier’s check(s), if needed, to bring total amount of earnest money up to the required amount.
- A pre-approval letter no more than 30 days old from a mortgage broker or lending institution, if you intend to finance your purchase (vs. a cash transaction).
Among the registration items you’ll receive is a numbered card or paddle which you’ll raise at the appropriate time during the auction to indicate your bid.
Taking your seat inside the auction room, you’ll listen to the event facilitator review the legal Terms and Conditions, along with a basic explanation of how the event will proceed.
The auctioneer will take the podium and kick things off with a welcome and a practice auction to warm up the participants and demonstrate the procedure for those unfamiliar. The first property to be auctioned will follow immediately thereafter. Photos and relevant facts will be displayed on one or more large screens, as well as online. You’ll find the same information on a printed brochure available in advance and at the door. The auctioneer will announce updates on any new additions or deletions that are not part of the printed brochure, so everyone is fully up to date on how to bid.
Each property will be listed in the brochure as “Absolute Auction,” “Minimum Bid Auction” or “Reserve Auction.” The auctioneer will verbally confirm these designations. He then begins his or her signature auctioneer’s chant, soliciting bids from the crowd. As a bidder, you will raise your numbered card or paddle when you wish to place a bid at the price the auctioneer is calling. Scratching your nose or clearing your throat will not count as a bid.
Depending upon where you are seated in the room, the auctioneer or one of his official assistants standing in the crowd will acknowledge your bid. The auctioneer continues the process, with the price moving ever higher. You can make as many bids as you wish as the process moves along. The auctioneer and assistants work the crowd until there is no more bidding forthcoming, at which point the winner is declared and the next property is called up for auction.
If You Win
- Proceed to the designated area to begin paperwork.
- A Buyer’s Premium will be added to your winning bid, making your total purchase price your winning bid plus the Buyer’s Premium.
- Submit the cashier’s check in the amount specified for the subject property. A receipt will be provided.
- Write a personal check, if needed, to add to the amount of the cashier’s check in order to bring the total earnest money deposit required for that property, which is typically 5% of the Total Purchase Price.
Your closing will be scheduled within 45 days of the auction.
Can You Change Your Mind About A Bid?
Yes, as long as you inform one of the official bid assistants while the bidding is still in progress and you have not yet been named a winner of the auction. Mistakes happen, of course, but the auction is serious business and you should be extremely careful about the actions you take during the bidding process. Know exactly what you are doing. Do not bid if you are unsure or think you might want to retract.
The Official Bid Assistants
These professionals will be standing among the crowd during bidding. They keep watch over the same section of attendees and are to relay your bid to the auctioneer and to help you with the process.
For more information about how to bid at real estate auctions, please don’t hesitate to contact us at 650-584-3741.