Frequently Asked Questions

BUYING AT AUCTION

Q. What are the advantages of buying real estate at auction?
A. Buying real estate at auction allows you to experience a quick purchase and closing, eliminates lengthy negotiations, and provides the assurance the price paid was market value.

Q. Why are properties sold at auction?
A. Owners make a wise business decision to sell property in a one-day sale rather than continuing to incur carrying costs and negotiating in a manner associated with conventional marketing.  Sellers are motivated to sell and offer you an opportunity to purchase desirable property at a substantial discount.  Over 90% of properties offered are sold at their auctions.

Q. Do I need to be represented by a Real Estate Broker in order to buy at the auction?
A. No. We do encourage buyer-broker participation; however, it is not a requirement.

Q. What is required in order to bid at an auction?
A. At a Live Auction (on-site) you MUST register with a valid ID (Driver's License) on auction day, bring a cashier's check (made payable to yourself, and must be shown to the clerk at the registration desk) for an amount as described in the auction advertising material, and receive a Bidder Card in order to bid.  If you are the highest bidder for a property you will be required to make an additional escrow money deposit (by personal or company check) on auction day for a total of 5% or 10% (see Terms & Conditions of Sale) of the contract sales price. Requirements for Online Bidding may differ.

Q. Can I buy more than one property?
A. Yes. You just need to bring and present a separate cashier's check for each property you intend to purchase.

Q. What does "Absolute Auction" mean?
A. Real estate being sold "Absolute" means the property will be sold to the highest bidder, regardless of the bid price.

Q. What does "Reserve Auction" mean?
A. An auction where the property is being sold with a reserve means that the property is being sold "subject to seller confirmation". The property will sell to the highest bidder above a preset minimum price (the undisclosed "reserve amount") determined by the Seller in advance.  This reserve amount is confidential and not published.  Once the reserve price is met, or is exceeded by continuous bidding, Seller is obligated to sell the property to the highest bidder.  However, if the reserve is not met the Seller can reject all bids without further obligation, or at his/her sole option, can elect to negotiate with the highest bidder and accept the highest bid.

Q. What happens once I have become the successful high bidder?
A: You give your Cashier's Check and Bidder Card to your Bidder Assistant or Auctioneer. 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, a date for closing will be established, usually 30 days after the Auction.

Q: Do I have to make any more deposits other than my initial deposit before closing?
A: You must increase your initial deposit to a total of 5% or 10% of the total purchase price (see Terms & Conditions of Sale) upon execution of the Contract for Sale and Purchase (day of Auction).  You may pay this additional amount by personal check.

Q. What is a Buyer's Premium?
A. Buyer's Premium is a percentage amount paid by the buyer and added to the highest successful bid to determine the final contract price.  If a Buyer's Premium is being utilized, it will be detailed in the Auctioneer's opening statements, Terms & Conditions, and in the advertising material published for that particular auction.

Q. Is my escrow deposit refundable if I change my mind after the sale and decide not to buy the property?
A. No. If a buyer does not close for any reason on or before the scheduled closing date, the deposit(s) will be forfeited. The only exception is if the Seller is unable to deliver marketable title.

Q. How long do I have to get financing after the auction?
A. The sales contract is "non-contingent" meaning that the contract is not subject to you getting financing.  We suggest, if financing is required to complete a purchase, you arrange and pre-qualify with a lender PRIOR to the auction date.  Basically, if you fail to pay the balance due by the closing date, through your own fault, you will forfeit your deposit(s).

            Sarasota Real Estate Auctions