..... Broker Auctioneer
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Auctions have been successfully used to sell nearly every commodity or item for many centuries. The use of selling real estate at auction has made major gains in popularity. Auctions have benefits for both the sellers and the buyers. Sellers set the selling date, establish the terms, and saves valuable time. Buyers enjoys a higher comfort level mainly because all other buyers have the same terms, and the bidding process is open with no hidden agendas.
The following information will help you better understand participating in auctions.
There are three types of auction sales: Absolute Bid Sale, Minimum Bid Sale, and Reserve or Confirmation Bid Sale.
Absolute bid sale means the property will be sold to the highest and final bidder regardless of the price, provided the bidding is opened.
Minimum bid sale means the property will be sold to the highest and final bidder at or above the predetermined and published price.
Reserve or Confirmation bid sale means the property may be sold to the highest and final bidder at or above an unpublished price. As a reserve or confirmation sale, the seller has the right to accept, or reject the last and final bid.
All prospective buyers must register in order to bid. All bidders are required to provide full name, address and telephone numbers, or other information pertinent to the purchase.
Upon agreeing to participate and possibly bidding, all prospective buyers must sign a registration form and are usually given a bidder number. Registered bidders are responsible for any purchases made with the bidder card and its bid number.
“Bidder Registration Packets” are furnished to prospective buyers at registration. Registration packets contain auction conditions or guidelines, property information, sample of purchase agreement, and disclosure forms.
Conditions and/or guidelines for an auction will be posted or published and given to all prospective buyers at registration. Conditions and/or Guidelines cover issues such as registration, bidder number, type of sale, bids, disputes, buyer premium, payments, and etc.
All registered bidders agree they have read the conditions an/or guidelines and furthermore agree to abide by them.
Auctions generally begin with the auctioneers introduction and opening remarks. As part of the opening remarks the auctioneer may review the conditions and terms for the sale. The auctioneer will also announce any additional terms or conditions not previously published. The bidding starts immediately after the auctioneers introduction and opening remarks.
The auctioneer will ask, through an outcry or chant, for a bid from the registered bidders. Once there is an opening bid the auctioneer will repeat the bid and ask for a higher bid. The bidding will continue until the bidders are done bidding and the auctioneer closes the bidding. The auctioneer will close the bidding with the word “Closed” or “Sold.”
The auctioneer reserves the right to accept bids in increments he feels are in the best interest of his client, the seller. If bidding dispute arises between Bidders, the Auctioneer may take action to resolve the dispute or immediately put the item(s) up for sale again, and resell the item(s). The decision of the Auctioneer shall be final and absolute.
The auctioneer also reserves the right to withdraw from sale any of the items listed to sell at his auction, and also reserves the right to group one or more items in a bulk sale.
“Phone In Bids” Telephone bids can be made and accepted provided prior arrangements are made with the auctioneer.
“Confidential Opening Bids” Confidential opening bid forms may be made available at registration. Confidential opening bids allow bidders to start the bidding with out disclosing themselves as competition. The auctioneer will open the bidding with the confidential bids.
The auctioneer with notice may reserve the right to bid on behalf of a buyer, seller, himself or the brokerage.
The buyer premium is a fee due in addition to the bid, the amount is established and published prior to the auction. The buyer premium is a percentage of the final bid and will be added to the final bid to total for the purchase or contract price.
It should be clearly understood that the buyer premium in no way implies or establishes an agency relationship between the buyer and the auctioneer. The auctioneer is the seller's agent.
If a real estate sale, the winning or final bidder will be required to execute a Purchase Agreement. A sample purchase agreement usually is furnished to registered bidders prior to the auction sale.
The required earnest money deposit and terms for payment differ from sale to sale. Earnest deposit may become a nonrefundable down payment upon seller's acceptance. Complete terms and payment for deposit are published and disclosed prior to the sale.
Financing is generally not a contingency in an auction purchase, therefore it is recommended the financing be arranged at a lender of choice prior to the action sale.
The settlement or closing will be scheduled per the terms published for the sale, usually thirty to forty days from acceptance date on the purchase agreement. The settlement is coordinated by the seller or the seller's assigns. Settlement is generally done by a title company per the terms of the purchase agreement and the customs of the area where the property is located.
Prospective buyers are advised that property inspections are made available by appointment and prior to auction date. Most properties are open for inspection at least one hour prior to the scheduled auction time on the day of the auction.
Prospective buyers may elect to have the property inspected by professional inspectors. Any property inspections must be made prior to the auction and not made as a contingency of the purchase agreement.
Prospective buyers assume responsibility to perform their own due diligence and analysis of the property.
In Ohio sellers of real estate have the responsibility of disclosing known defects. Disclosure of known defects will be through published material, opening statement, purchase agreement or property disclosure forms. Property disclosure forms, completed by the seller, normally is provided to registered bidders.
In Ohio real estate auctioneers must be a licensed real estate sales person or broker and a licensed auctioneer. The Ohio Department of Commerce and Division of Real Estate and Professional Licensing issue and monitor the licenses of real estate auctioneers.
For more information on auctions and/or real estate in the Port Clinton, Oak Harbor, Catawba, Marblehead, Lakeside, Lake Erie Islands, Fremont and surrounding areas, call Len Partin, Jack Bradley Realty Co. 419-356-8777 or click here for our web site .
For more information on auctions and/or real estate in the Port Clinton, Oak Harbor, Catawba, Marblehead, Lakeside, Lake Erie Islands, Fremont and surrounding areas, call Len Partin, Jack Bradley Realty Co. 419-356-8777 or click here for our web site .
