The real estate sector, at least in Florida, has returned to be a fashionable market. Everybody wants to get in and can tell from real estate ‘Auction’ sites like Auction.com and Hubzu.com. Previously, these sites simply worked with banks and ‘auctioned’ off their REO inventory, but now, wherever you go, you will see these $ 100 minimum bid auctions being advertised on these sites and others like Zillow, Trulia, and Realtor. .com.
Hey, I want a $ 100 property, how can I participate in this advertised action?
The REO and foreclosure industry is large and complicated with many ways to profit and many ways to get burned. I won’t go into all the ins and outs of the industry and how to profit, but I would like to talk about these $ 100 auctions. County auctions are where a property’s foreclosure auction actually takes place. Yes, every county in every state holds these auctions daily. Each county has its own set of rules about what days and times they auction their properties, as well as whether they hold their auctions online or in person. Whichever county you would like to participate in will have those rules generally set out on your court clerk’s website.
So what are the steps I need to take to bid?
If the county in which you want to participate runs its auctions online, you will need to create an account with that county before you can bid. Once your account is created you will need to fund it, the percentages vary, but let’s say your county needs a deposit of 5% of the sale price. So what that means is that you have to put 5% of your maximum possible bid into this account, otherwise you will not be allowed to bid. You have decided that you only want to bid on properties that cost $ 50,000 or less. You will need to add $ 2500 to your account. If the county you would like to bid in has in-person auctions, it is best to bring a pocket (or briefcase) full of cash, which will expire at the close of the auction.
Okay, I’m done, at my first auction.
In online auctions, there are two ways you can bid: you can set a maximum bid and let the software increase your bid as the bid is exceeded, or you can view the auction in real time and bid manually. So you’ve done your research and found the house you’d like to bid on … did you receive a title report prior to the auction? Wow, more on that in a later post.
Today 30 houses are being auctioned, his property is number 17. So you wait, and you wait, and property # 11 two people are manually bidding each other and waiting until the last second to make their bids, so this property that it should take about 5 minutes is taking 20 minutes. What these two don’t realize is that you can’t make a sniper bid at these county auctions, the clock is reset. So you look at them for another 5 minutes and someone finally concedes.
Well, here we are at property n. # 17. There are too many scenarios to talk about, so we will discuss a few assuming you are manually bidding.
The same scenario as n. 3, but this time he wins the auction for $ 47,500. Congratulations, but you’re not done yet. The property of your dreams does not have a maximum offer for the plaintiff, is valued at $ 60,000 and has a final judgment of $ 45,000; cool, you can get in on the action. Auction starts at $ 45,100. Okay, the plaintiff (most of the time the bank) can no longer bid, why don’t you ask, because that will be another post. Time is ticking and you bid $ 45,800, the bid price goes to $ 45,500. The clock is ticking. The sale price goes up to $ 45,900, suddenly someone outbid you. You put in another offer of $ 48,000 and the price of the offer goes up to $ 47,500, now you are winning. The clock is ticking, it’s almost yours, no, the offer price goes up to $ 48,100, someone who thinks they can bid it has outbid you, the clock starts again. This happens for several minutes until the other person takes over your bid limit of $ 50,000.
Your dream property says the plaintiff has a maximum bid set of $ 35,000, is valued at $ 60,000, and has a final judgment of $ 36,000 – great for you to get in on the action. The bidding begins and amounts to $ 55,000. Gee, I guess you’ll have to try again.
Your dream property says the plaintiff has a maximum bid set of $ 75,000 and the property is valued at $ 100,000 with a final judgment of $ 75,000. Wow I guess I should have looked at it before putting in all that time and effort, you can only bid up to $ 50,000 with your deposit.
I won, now what?
He won his auction for $ 47,500. Most of the time, the auction will email you directly after the auction that you have won with a request for the total you owe (not just the $ 47,500) but the fees as well. If you have $ 48,000 in your auction account, just log in and pay. If you only have $ 2,500 in your auction account, it’s time to get going. Now you have to go to your bank, get the additional funds so you can take them to county court, deposit those funds, then go back to your computer, log in, and pay the amounts online. In many counties, you only have until the end of the day (4 pm) to pay the funds. Otherwise, you will be evicted and the property will be re-auctioned. Now wait 10 days for the deed and proof of purchase. That is if you didn’t just buy a subordinate link.
I lost, now what?
Then you have lost your auction. Unless you want to beat everyone’s offer and money is not an issue, get used to it. There are many competitors in these auctions, including banks, and a lot of money is used. Do your research, stick to your highs, and eventually you will.
Doing your research
Rules for the plaintiff
Get in – Securing your vacant earnings, Oops, yours came with the tenants, WOW, not what you expected to see.
Possible Problems With Your Winning Auction – Who Are All These People On The Defendant List? Right of Redemption – Owner and IRS, Title Reports, Did I Just Earn a Subordinate Link? Capital lines and HOA