Real estate auctions are popular for various reasons. The auction provides an opportunity for sellers and buyers to transact publicly. In the past, the auctions were the preserve of investors and professionals in the real estate sector only, but this has changed in recent times. The reasons that necessitate public auction of houses include foreclosures, repossession by the bank and the government deciding to reclaim the property to offset a debt the owner owes it. The auctions are available in three main categories, which are:
- Reserve auctions
- Absolute auctions
- Minimum-bid auctions
Nonetheless, you should follow these basic steps to participate in such auctions:
Find the auctions, and track them
First, you must not only find, but also track the auctions. The Internet is full of various places where you can find information on the auctions. Check the local newspapers too. Look for a reputable and highly professional realtor for details on the upcoming auctions. Some auctions take place online. Other places worth visiting for information on the planned auctions include conference centers, local courthouses and at the offices of the Springfield, Missouri auctioneer. Don’t forget to visit the local auction houses too.
Do some research
Finding and tracking the auctions isn’t enough. In addition to these, you also have to do your own research. Don’t wait until the day of the auction to understand the transaction details as well as due diligence documents that must be read and signed. Seek advice from your real estate attorney on any issue you find complicated enough to understand. Knowledgeable agents are just as helpful. Your research should also focus on learning the property’s estimated value. Other areas of focus should be:
- The balance that the homeowner owes on the mortgage
- Liens against the house
Visit the property
Never bid for any property that you haven’t seen or visited. Seeing is good, but visiting the property is much better. The home that’s up for foreclosure usually has a renter or the owner as the primary occupant. It’s illegal to trespass on the property while the resident remains inside. Next, you must have a good understanding of your responsibilities. For example, bidding on the foreclosed property means bidding on it on the ‘as-is’ basis. This is a true case of getting what you pay for.
Put your finances in order
Your finances should be in order before bidding for the foreclosed property that’s up for auction. Cash is acceptable in most foreclosure auctions. Cashier’s checks and bank money orders are also accepted. For the most part, the auctioneer expects you to pay immediately after the auction; that’s if you were the successful bidder. In some jurisdictions, you’re scheduled to pay a specific percentage during the auction before settling the balance within specified timeframe. Be ready to make advance payments or deposits when going for county foreclosure auctions.
Lastly, never ignore any detail of the auction. This is your moment to put your hawk-eyed capabilities to good use. Check whether the auction is still on, including on the actual day set aside for the event. Check such details with your auctioneer. It’s normal for a cancellation to occur once the borrower pays up the balance. It’s advisable to show up at the auction and place your bid personally. The last thing remaining is the arrival of a certificate of title from the Springfield, Missouri auctioneer proving you’re the winning bidder and the owner of the property.