Real estate auctions
Anyone know how they work?
There is a foreclosure property I found on Trulia that is up for auction. There are no pictures or details other then how many bed and bathrooms and total square feet.
How do these work? Do you need to be pre-qualified to bid at the auction? Are you allowed a tour of the property before making bids? Can you get inspections done?
There is a foreclosure property I found on Trulia that is up for auction. There are no pictures or details other then how many bed and bathrooms and total square feet.
How do these work? Do you need to be pre-qualified to bid at the auction? Are you allowed a tour of the property before making bids? Can you get inspections done?
0
-
You will need to find out where the auction is held. Most often on the courthouse steps. Then the date. Usually the first or second Tuesday In GA you have to get there early and pre register by getting a packet from the agent for that property on the steps. Then you have cashiers checks made out to you in your possession. Usually in 10,000 increments and you bid until you decide to stop. Usually there is a no inspection, no due diligence.
The property will probably get a bid by an agent from the bank for the mortgage amount and then it will go from there.
Ros
What state?0 -
Pennsylvania.
So your expected to drop a over a hundred grand on A piece of property without any idea about it? It could be a crack house needing to be leveled for all I know.0 -
Unclear what type of auction. Masters Equity , bank foreclosure, Tax ... 0 -
You have the address, go look at it. Go to the courthouse/recorder and look up the property to check for code violations and construction permits surveys, easements etc. Make sure any additions are permitted.
In California, they have superfund cleanup sites and if your new property is one of them, you are on the hook. That will hold true for any and all cleanup or eco issues.
WALK THE PROPERTY, if you can get inside so much the better.
In other word due diligence is extremely important.
If that the property is being sold for back taxes, that frees you of all encumbrances and monetary judgements on that property. In some states, there is a period that the owner has to pay the property taxes and you have to relinquish the property. You get reasonable interest on your money.
If it is a loan foreclosure, another set of rules apply. I am not fully familiar with foreclosure auctions. I am not sure if disclosure laws apply on the foreclosure properties, they don't on a tax lien sale. Both my homes were foreclosure, neither went to auction.
Usually, $10k is put up (cash or certified money) before they give you a bidder ID. You get 24 hours to pay the balance or you are out your $10k. Each municipality may vary some.
Walk the property, as much as allowed. Check all property records. Contact previous owners if you feel comfortable. Check the neighbors and talk to them. Pick a number you are willing to pay and stick to that.
Good luck, it is a brutal game.0 -
Hello "joshmb1982" - did you get the fishing rod repaired & how - if so please reply on a separate thread - and please forgive me hijacking this one - but it is the only one I could be sure you would look at.
The property auctions are pretty much the same in Florida as "mag00" described - the leg work is up to you.
Best Regards - AQH0 -
Usually it's listed in the papers of some sort with addy a few weeks out so you can take a looksee. It's true about the court steps or some where like it. 0 -
Ok thanks all. Sounds like I will be staying away from that headache. 0 -
quote:Originally posted by joshmb1982
Ok thanks all. Sounds like I will be staying away from that headache.
+1 most are sold as is, which mean sometimes buyer may be responsible for any leins, or some cases back taxes, to many suprises for me, same with repairs, water, sewer, ect. I like to know what I am buying..0 -
Varies considerably from state to state.
Some states property is like a car and the bank repossess it.
Others like Florida the bank has a lien in that amount and even if the buyer never paid a dime after moving in and the market goes up the bank only gets the mortgage and actual fees and the buyer can make a killing.
Banks hate this because they alone should benefit from loopholes.
As stated there are different types of auctions. and while most liens are wiped out not IRS liens or debts not yet adjudicated (like city utilities etc)
You should mention what state this auction will take place0 -
You must also check to see that is is in fact a foreclosure on the first mortgage.
If this was for a lien or a second mortgage you are accepting the first mortgage and must pay that.
If it is a tax lien you are responsible for other liens on the property
If it is the first mortgage being foreclosed on all back taxes will be included in the sale and all liens and second+ mortgages will be wiped out.
Usually representatives come and bid on the property to protect their interest.
Example (Florida only other way be the same or very different)
Let's say the foreclosure is on the first mortgage for $100K and it has a second mortgage for $30K and a lien by a roofer for $20K
The 1ST mortgage sends a rep and everyone knows who the reps are so you go up and ask him/her what will you bid to?
He says $100K
House is worth say $115K+ so that is OK and you open the bid at $100K +$1.00.
He stays silent and the roof lien holder and 2nd mortgage did not show up.
You get the property for $100,001.00 + court fees and doc stamps (less than $1K)
If you think about this the variety of possibilities is endless so you better have a clue as to what you are doing.
I saw a couple bid on what they assumed was a first mortgage and was actually a second mortgage and got stuck paying $30K more than the house was worth and it needed repairs0
Please sign in to leave a comment.
Comments
10 comments