How to Become a Home Auction Bidder
Buying a home at an auction may get you a good deal, but you may also end up with a property you regret buying. You don't have to get any formal education to become a home auction bidder, but you need to know how an auction works. You must also know how to carry out proper due diligence because most auction properties are sold as-is, which means that the seller is not responsible for damages.
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Instructions
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Public Auction
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Contact the trustee or the county clerk responsible for the property you want to buy is located. A property that is publicly auctioned is usually a foreclosure property. Ask about the location and timing of the mortgage foreclosure auction.
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Prepare the funds to pay for the purchase of the property. The amount you have to bring to the auction and the form of payment vary from state to state, so check with the trustee or the county clerk. You may have to bring the full amount of your winning bid or just a percentage of it. You may have to bring the money in cash or check.
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Contact the trustee or the county clerk one day before or on the day of the auction because auctions sometimes become postponed or canceled. If there are any changes, ask for the new timing and location of the auction.
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Go to the auction location at the time indicated by the trustee or county clerk.
Private Auction
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Browse through the available properties on the auction company's catalog, which may be available online. Note the property you want to buy and the price you are willing to pay for it.
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Contact the real estate auction company to find out the time and location of the auction. Ask about any documents and funds you need to prepare. For example, you may have to bring a picture ID and proof of funds.
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Show up at the auction location at the auction time. You may have to show your documents and register at the door before you enter the auction room.
Online Auction
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Call the number listed by a real estate auction website as its business phone number to verify the number. MSN Real Estate also recommends that you choose a company that has been in business for a while and has a physical address.
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Register with a reputable real estate auction website.
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Transfer your deposit funds, if necessary. However, the deposit should go to an escrow company for holding instead of to the real estate auction website.
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Make a bid by entering your bid amount and submitting it over the Internet. Depending on the seller and the website, you may have to meet a minimum reserve bid amount to win the auction, even if you make the highest bid.
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Tips & Warnings
Determine your maximum bid amount before you attend the auction and stick to it so you don't end up overpaying for a property. For foreclosure properties, RealtyTrac recommends setting your maximum bid at about 20 percent below the market value. Determine the approximate property value before making your bid, for example by checking public records, personally visiting the house, conducting a professional property inspection, having a contractor estimate the repairs cost and comparing it with similar homes in the area.
References
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