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Exploring Real Estate Auctions

Three Types of Auctions:

Absolute Auction: There is no minimum bid required. The real estate is sold to the highest bidder.
Minimum Bid Auction: Seller sets minimum bid for the real estate. If the minimum bid is not met, then the seller is not obligated to sell. Seller and highest bidder can meet in private to work things out if possible. Auction still gets paid for that service.
Reserve Auction: Allows seller to reserve the right to accept or reject the highest bid within a 72-hour spam of time. Seller is not obligated to sell to the highest bidder. Seller may not have set price in mind.

Benefits of Auction Homes

Benefits at an Auction:

Compare the benefits for both Buyer's and Seller's. For Example...

Seller Benefit: Seller is able to accept their bottom price at auction. The minimum bid is set before the auction date.

Buyer Benefit: Buyer is setting own market Market Value on property at purchase. Buyer is not relying on realtor or appraiser to set the price.

Preparing for Auction

How does one prepare for an Auction as a buyer?

Buyers must come prepared to the auction knowing what one is willing to pay for a piece of real estate. One must take emotions out of the equation. One must do their homework to be fully educated and prepared to roll out a decision at auction.

Here are my personal recommendations when preparing for auction...

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Making a Bid

Once you've found a house you like, you must decide how much to offer. In putting together your actual offer, consider the following seven factors:

Here is an example of a home purchased recently at the Auctions by one of my clients.

Also referred to as "purchasing at the court house steps" and "real estate auction", this event is being used by banks to sell homes in which they have foreclosed upon. If used properly, one can get a great deal on a house by buying from the trustee sale.

Click here for a list of benefits for the seller and buyer of a home at the trustee sale.

Here is an example of a home purchased just last week by one of my clients:

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