How to Bid Online for Homes
A new industry of online real estate auctions is taking hold. Online auctions have increased the competition and number of homes available for sale. Creating an environment where great deals can be found, transactions are smoother and closing times are shorter. It is important to understand the rules and process of bidding online for homes. Buyers need to be prepared and have all financial arrangements in order before bidding on a home.
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Instructions
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Research the auction site. It is important to know the background of the company that will be processing a home purchase. Make sure the site is licensed to sell real estate. EBay auctions property, but home sales on EBay are not binding. It is a good idea to read eBay's Real Estate Rules page before bidding on the site.
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Find out what types of homes are being sold on the site. Bank repossessions and foreclosures may have liens on the property or damage to some parts of the property.
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Sign up with the auction site. All sites will have the buyer register and provide a credit card or some other source of verification. According to the U.S. Government's Homes for Sale site, "Anyone can buy a home for sale by the U.S. Government, but you must work with a real estate agent, broker or servicing representative to submit an offer or bid." If this is the case, the buyer will need to contact a real estate agent who can place the bid on the home.
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Pre-qualify for funding either through a known lender (bank) or through the auction site.
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Research the homes up for bid. Check to see what type of bid is required on the house. The types of bidding are absolute (property sells to the highest bidder), minimum bid (a minimum bid amount is set) and reserve (seller reserves the right to decline the bid).
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Read all the information provided on the home for bid. An informed buyer will have few surprises if he does the research. After the bid is approved, things move quickly with auctioned homes. There are no inspections and very little back and forth between buyer and seller. Some auction sites have bidder's packages that include recent inspection information and disclosure statements.
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Contact an agent and have her go to the house to check on it. Many homes will have open house times and dates.
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Make the bid deposit. A percentage of the bid (usually 5 percent) will be authorized on the credit card on file. This amount is authorized, but not charged. If the buyer does not win the bid, the amount drops off the card within 24 hours of the end of auction. For bid winners, the amount is held until the actual funds for deposit are received by the seller or seller's agents.
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Place the bid for the house.
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Finalize the sale by reviewing the terms and conditions. Then, accept the sale.
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