How Is the Official Minimum Bid Set for a Sheriff Sale?
Minimum bids at a sheriff's auction vary according to the jurisdiction. Some auctions begin with an opening bid ranging from $1 to $100, some calculate the costs of the auction and others receive a minimum bid from the mortgage company.
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Types
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In some jurisdictions sheriff's auction officials set a low minimum bid such as $1 or $100. The highest bidder receives a sheriff's deed rather than title to the property. The buyer must clear up any encumbrances on the property such as unpaid taxes, assessments or liens before receiving title to the property.
Time Frame
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Some localities announce the official minimum bid before the sheriff's auction, posting it in newspaper and online notices.
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Adding Costs and Fees
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In counties where the sheriff's department adds up court fees and costs associated with the auction, they may also add a sales commission to the minimum bid.
Appraised Properties
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When foreclosed property has been appraised before a sheriff''s auction the official minimum bid often equals two-thirds of the property's appraised value.
Mortgage Holder's Bid
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In some sheriff's auctions, a representative of the mortgage holder will either submit a minimum bid to the sheriff's department or send a representative to attend the auction and make the opening bid.
Features
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Some jurisdictions hold so-called "open" auctions with no sealed bids while others accept sealed bids until the morning of the sale.
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References
- Photo Credit for sale sign image by Attila Toro from Fotolia.com
