Frequently Asked Questions

I’ve never bought real estate at an auction; how does the process work?

It’s important to do your due diligence and be prepared to bid before you ever show up at the auction. Other than this, it’s really very similar to any other real estate transaction – except you will be bidding on the property against other individuals, instead of haggling price with the seller. Make sure you do things like inspect the property during a preview date to ensure you are completely comfortable with buying the property.

What is required in order to bid at an auction?

You MUST register on or prior to auction day in order to bid. At registration, you must show us certified funds, made payable to yourself in the amount listed in auction terms. If you are the high bidder, then you will sign endorse the certified funds over to the Escrow Attorney.

How are auctions conducted?

Nearly all auctions we handle are held via an open bidding process. As a bidder, all you need to do is hold up your bidder card and call out your bid, or tell one of the Bidder Assistants what amount you want to bid. The Bidder Assistants are available to help you and will be roaming the floors during the auction.

What happens once I become the successful high bidder?

You give your certified funds to your Bidder Assistant. You then move to the contract table where you endorse your check and complete the Contract for Sale and Purchase. Once you have completed all the paperwork, you then set a date for a closing appointment with the title company. Don’t worry, we’ll help you through every step.

To whom do I talk to if I don’t understand the auction contract?

Auction buyers must be educated and informed regarding the auction process. Make sure all your questions and concerns are answered before you attend an auction. Ask us and we’ll discuss the entire auction process and answer any questions. Our contract is available for your review. Just give us a call, or feel free to have your legal advisor review the contract prior to the sale.

Is my deposit refundable if I change my mind after the sale and decide not to buy the property?

If a buyer does not close for any reason on or before the closing date, the initial deposit may be forfeited. For this reason, it is very important for you to do all of your due diligence before ever bidding at the auction.

Why would someone sell Real Estate at auction instead of pricing it?

Auctions are fast, efficient and produce fair market value. When a property is “priced” it is either under priced or overpriced. Either way, the seller loses. If the price is too low it sells quickly but equity was lost. If the price is too high the property does not sell. It then has to be advertised again at a lower price or negotiated through negative haggling with one person at a time.

The auction creates a sense of urgency. All serious people are brought together to compete. The seller is assured of fair market and so is the buyer that obtains the item at one bid over the next interested person.

Do I need to be represented by a Real Estate Broker in order to buy at the auction?

No. It is not a requirement, but we have no issues with you being represented by a buyer/broker.

Are auction sales contingent on inspection?

We encourage our buyers to do their due diligence prior to sale day for their own protection. All of our sales are on an “as-is” basis. There are no warrants as to the condition and/or the fitness of the property for particular use.

When can I inspect the property?

The property is generally available for viewing by appointment or at an advance inspection time.

What happens if for some reason the seller cannot settle on the property?

Our service contract states that the seller must be able to deliver free and clear title to the property without any liens or judgments. In the case that free and clear title cannot be delivered by the seller, the buyer will be refunded his/her deposit.

Who is responsible for closing costs?

The buyer is responsible for all closing costs, as stipulated in our contracts. Closing costs can include, but are not limited to title fee and recording costs.

If a property doesn’t sell auction day is it still possible to market it?

Yes. Many times a buyer who wants the property but is uncomfortable with the auction process will make an offer after the auction date. In other instances offers to buy the property prior to the auction date are made and accepted. Bonnette Auction Company will aggressively market the property until we put it to contract in the event that the auction wasn’t successful.

How can I be sure I am getting a fair price?

The real fair price is the actual market price and the market price is what someone else is willing to pay for it. The real measure of value of real estate, at any given time, is what it will bring under competitive bidding from informed and motivated buyers.

Why should real estate agents bring buyers to auctions?

If an agent brings a buyer to an auction, and that buyer purchases property, the agent will receive a commission. To ascertain the amount and structure of any commissions to be offered, refer to the particular terms and conditions of the auction contract.

Please note, you must register as a buyer’s broker at least 24 hours in advance.

What are advantages of real estate agents selling their listings through Bonnette Auction Company?

Often a broker and seller become impatient because the property they are attempting to sell is not moving. The auction process increases exposure, pumps up the temperature, and exposes buyers who have not been visible previously. It is our policy to share all new customers generated from the property with the cooperating broker.

Agents will get a list of real new customers with financing capabilities who have proven themselves to be real buyers with certified checks in their hands.

Who usually buys at a real estate auction?

Only real buyers. browsers and time wasters are eliminated. Anyone can benefit from buying at a real estate auction. Many people who buy are first-time home buyers. For them, the auction is a realization of a dream. Empty nesters and investors also comprise a large segment of the auction buying public.

How are properties usually advertised for auction?

The various forms of advertising are:

  • signage
  • mass e-mails
  • brochures mailed directly to prospective purchasers and posted in public places
  • newspaper advertising in local and possibly regional or national papers
  • ads in trade journals and magazines
  • internet
  • phone solicitations

Bonnette Auction Company is an experienced auction company who knows which form of advertising are best for a particular type of auction and its location and will facilitate everything from preparing the advertisements to placing them in the desired forms. The aggressive advertising hits large group of buyers that will come and competitively bid on property thereby yielding true fair market value for a seller’s holdings.

What factors determine the success of an auction?

The factors are:

  • Realistic expectations on the part of the seller by expecting and accepting Market Price.
  • An aggressive marketing and advertising plan geared to prospective bidders.
  • Undertaking due diligence ahead of time so buyers are knowledgeable and the only issue that remains is price.

Do real estate auctions bring the highest price for the current market?

Yes. Real estate auctions tell the true market value of a property since auctions are conducted in an open forum where all bids are known, and participants are given immediate feedback on the property’s value. At auction, true market value is revealed.

Are there different kinds of real estate auctions?

Yes, auctions can be Absolute, Subject to Confirmation, with Reserve, or with a Stated Minimum.

What does Absolute Auction mean?

A property that is sold at Absolute Auction means that it is selling to the highest registered bidder regardless of price. There is no minimum and the seller cannot reject the highest bid attained at the auction.

What does Subject to Confirmation mean?

It means that the property is being offered to the highest bidder subject to the seller accepting or rejecting the bid. Most Bonnette Auction Company auctions are offered subject to seller confirmation.

What is a Reserve Auction?

It is similar to the subject to confirmation auction, except there is an undisclosed reserve dollar amount set by the seller. The property cannot be sold unless the bidding meets or exceeds the reserve.

What is a Stated Minimum Bid Auction?

An auction where the Seller announces the reserve or minimum bid and generally will sell the property absolute at or above the stated minimum.

Example: This property shall sell at absolute auction at or above a minimum of $41,237. If any one bids the stated amount or more the property will sell.

What is a buyer’s premium?

A Buyers Premium is that portion of the commission paid by the buyer. The Buyers Premium is added to the bid to become part of the total sale price.

When and where does the closing take place?

Bonnette Auction Company recommends 30 Days for closing. However, some sellers opt for 30 or 45-day closings for their auctions. The closing is usually at the Buyers attorney’s office or at the office of the lending institution.

What factors determine the success of an auction?

The factors are:

  • Realistic expectations on the part of the seller by expecting and accepting Market Price.
  • An aggressive marketing and advertising plan geared to prospective bidders.
  • Undertaking due diligence ahead of time so buyers are knowledgeable and the only issue that remains is price.
Do real estate auctions bring the highest price for the current market?

Yes. Real estate auctions tell the true market value of a property since auctions are conducted in an open forum where all bids are known, and participants are given immediate feedback on the property’s value. At auction, true market value is revealed.

Are there different kinds of real estate auctions?

Yes, auctions can be Absolute, Subject to Confirmation, with Reserve, or with a Stated Minimum.

What does Absolute Auction mean?

A property that is sold at Absolute Auction means that it is selling to the highest registered bidder regardless of price. There is no minimum and the seller cannot reject the highest bid attained at the auction.

What does Subject to Confirmation mean?

It means that the property is being offered to the highest bidder subject to the seller accepting or rejecting the bid. Most Bonnette Auction Company auctions are offered subject to seller confirmation.

What is a Reserve Auction?

It is similar to the subject to confirmation auction, except there is an undisclosed reserve dollar amount set by the seller. The property cannot be sold unless the bidding meets or exceeds the reserve.

What is a Stated Minimum Bid Auction?

An auction where the Seller announces the reserve or minimum bid and generally will sell the property absolute at or above the stated minimum.

Example: This property shall sell at absolute auction at or above a minimum of $41,237. If any one bids the stated amount or more the property will sell.

What is a buyer’s premium?

A Buyers Premium is that portion of the commission paid by the buyer. The Buyers Premium is added to the bid to become part of the total sale price.

When and where does the closing take place?

Bonnette Auction Company recommends 30 Days for closing. However, some sellers opt for 30 or 45-day closings for their auctions. The closing is usually at the Buyers attorney’s office or at the office of the lending institution.

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