Everyday we watch as the rising number of bank owned properties increases. Every neighborhood is flooding with these unmaintained eye soar properties.
The majority of lenders out there are not willing to negotiate on the price. I bet they just don’t want to comprehend they are on the losing side this battle.
There are not many ways out there to get these properties sold to home buyers or investors. One of the biggest ways to come to my mind is live auctions.
Online auction house’s popularity is huge today. You can have a mild auction feeling in the comfort of your own home. All it takes is a little addiction to online auctions and before you know it you will be at the live ones.
The simplistic nature of an auction is it’s greatest attribute. They are so simple to setup and finish that you could almost turn your head and it will be over. Just like that you have missed that item you wanted to bid on.
When I go to an real estate auction as an investor I’m looking for a good deal. I know exactly what I am looking for. Also, what price they are worth and what I am willing to pay. Just too many times I just watch people bid them past what they are worth on the open market. On top of that they have to pay the auction house for its time. At that point you could of just made an offer on a similar property for a much lower price.
A fix percentage of the final bidding price is the most common way an auction house gets paid. That amount is added to your bid to make the final purchase price.
When bedding at an auction remember to calculate all of the costs when evaluating your bid. Make sure to have a maximum bid that you will not pass. Your maximum bid should include all your costs like auction fees, closing costs, and anything other you can think of.
I sometimes enjoy reading the small print of various things. It makes me laugh how many disclaimers there are on everything. One day I picked up an auction booklet and flipped to back. There were so many things that made me laugh. In the end I just thought auctions are becoming a joke.
The first few pages of an auction always show you what an amazing deals you could get. In truth those numbers are just there to get your attention and motivate you to actually attend. Do you think that anyone would sell a house $500,000 home for $79,000?
The reason why many auctions have such low beginning bid amounts is because they have reserve amounts. Which enables them not to sell the property unless you bid the price above the predetermined acceptable price set by the seller. The only place that talks about reserve amounts is in the small print in the back of their pamphlet. In the front of the pamphlet no where I can find a mention of a reserve. I wonder why?
Did you know that if you win an auction the seller typically has seven days to accept or deny your bid? Even if you win and your bid is higher than their reserve that does not mean that you have won.
Auctions are seeming to me to become a waste of time and money. I have to waste a full day and show them a considerable deposit just to bid. The actual bidding is suppose to be up to the buyers not the sellers.
I recommend to go to an auction for your self. Just be aware of everything before bidding
Tags: Real Estate
