How Does an Auction Work?
- We will meet with you and determine if the auction method will work for your situation.
- We will thoroughly explain the auction method and the types of auctions available (outcry and progressive)
- Once the auction type is selected, we set a date for the auction and the 2 preview dates.
- Contracts and disclosures will be signed.
- We will determine the property condition by contracting for the performance of multiple inspections.
- An appraisal will be performed for marketing and informational purposes.
- Previews will be conducted and marketing will begin. We will be present at previews to pre register buyers, and allow all buyer’s inspections to take place. Buyers who register to bid will receive a bidder’s package with copies of the inspections and disclosures.
- On the day of the auction, the buyers must register and supply the required documentation and deposits if required. They will now be eligible to be a bidder and place an opening bid.
- The auction is held, and the high bidder will sign a purchase agreement as soon as practical after the conclusion of bidding. An escrow closing date will be selected on the purchase agreement (usually 30 to 45 days from the auction date).
- Escrow closes! If escrow fails to close, the bidder forfeits their deposit.
Properties are sold by progressive bidding. All property is sold "AS IS." You do not need a real estate broker or agent to participate, however we gladly will work with brokers and agents.
Prospective bidders must register to bid during the specified registration time for the sale, or register online. Registration times are set individually for each auction before the auction or at preview days, see auction listings for details.
Prospective bidders must bring photo ID, required cash deposits in cash or certified funds, and pre-approval letters from their lenders. Upon successful check-in, a bidder may make an opening bid.
Terms of the sale
The Auctioneer will announce the terms of the sale at the beginning of the auction. Any announcements made on the day of the auction take precedence over any other previously announced or documented information, but do not alter the terms and conditions of sale.
Depending on the type of auction, the Auctioneer will either begin verbal bidding, or progressive bidding. In an outcry auction, the Auctioneer will ask for bids, and the bidders can accept his invitation or make another bid. In a progressive auction, initial bids will be made on a bid sheet at the property. Subsequent progressive bids will be received by the Auctioneer by phoning bidders and gathering higher bids based upon the current high bid and the required minimum bid increment. These processes will continue until the highest and best bid is made. The Auctioneer can accept or reject the final bid, and all other bids.
If there is a dispute between two or more claims of entitlement as the successful bidder, Auctioneer reserves the right to reopen bidding on the property or he may, at his sole discretion, designate one of the bidders as the successful bidder. Auctioneer reserves the right to sell on behalf of third parties, its own account or on the account of others.
Generally, the opening bid is set buy a bidder or the seller. Auctioneer reserves the right to accept or reject any and all bids.
If you cannot attend the auction in person, you must contact Action Property Auctions before the sale to arrange to bid by proxy. All terms and conditions of the auction will remain the same for absentee bidders. The presence of absentee bidders will be announced at the auction. The Seller reserves the right to sell their property before the auction if an acceptable offer is obtained through Action Property Auctions. It is recommended to make an offer if you are unable to attend the live auction. Contact us for details.
Award of high bid
The Auctioneer's announcement of the high bid amount and the Bidder's number establishes the contract which is subject to final acceptance by the Seller. The placement of a successful bid at the auction establishes a legally binding contract between the successful Bidder and Seller. The Seller reserves the right to accept or reject any and all bids.
Immediately after the bidding, the high bidder will be required to provide their earnest money deposit check. The Terms of Sale will explain deposit requirements for each property. The successful bidder's deposit will be retained as the initial payment for the property. This deposit is non-refundable.
“As Is" means that the Seller and Auctioneer do not guarantee or warranty anything about the condition of the Property being sold. It is the Buyer’s sole responsibility to determine the condition of the property before bidding and or purchasing. The bidder’s package is meant as a guide to assist the Buyer in their inspections.
Reserve price is a minimum dollar amount placed on a property by the Seller. A reserve price is not public information. If you hear the auctioneer say "Bidding closed, subject to the acceptance of the seller," it means the high bid did not reach the reserve price. In the event the high bid does not reach the reserve price, the Auctioneer may open negotiations with the high bidder and/or other bidders and Seller. There are several things that could take place. The Property is either returned to the seller or sold to a buyer at a lesser price. The lower price is reached by the Auctioneer lowering the Buyer’s premium or because the Seller has agreed to accept the high bid or a combination thereof.
Buyer’s premium is a fee added to the winning bid and is paid by the buyer to the Auctioneer as part of the total purchase price. The fee is either a percentage of the sales price or a flat fee. The buyer’s premium is always clearly marked at the sign-in counter, in the printed catalog, and on the web site. Auctioneer will always announce premium rate at the beginning and end of the auction.