Foreclosure auctions can be incredibly fruitful for the purchaser; however, they can be equally disastrous. Occasionally, buyers purchasing auctions on the courthouse steps are buying site-unseen and without the typical luxuries of appraisals and inspections. Still, there are ways for buyers to insure that their foreclosure auctions are successful. Read below for the five important steps involved in purchasing a property at foreclosure auction.
Find a Property
There are tons of resources available to people interested in purchasing properties at foreclosure auctions. You can find properties that are going to be available for auction in three main ways: watch the yard signs, make a REALTOR your friend, and, of course, the internet. Yard signs are often posted on auction properties that tell the date and time they are going to be sold. In addition, REALTORS are often sent flyers on properties that are going to be sold at time of auction. The internet is filled with lists of properties that are going to be auctioned as well.
Determine Auction Status
Another key element in establishing a successful foreclosure auction for you is determining the auction status. In most cases, borrowers that are being foreclosed on have a time period in which they can pay of the remaining amount on their loan. Because of this, auctions are often scheduled and rescheduled.
Determine Market Value
Before placing a bid on a property, it is essential to know two important things: the starting bid, which is often the remaining amount of the loan, and the market value of the property. There are several online sites that can help you in this process, including online tax records. These can show you what similar properties in the area sold for. This is also where having a good REALTOR friend can come in handy.
Place a Bid
The next step in the foreclosure auction process is placing a bid. The system is going to vary depending on where the auction is and the protocol the auctioneer is following. Therefore, it is wise to arrive early and introduce yourself to the auctioneer. Ask any questions you may have.
Take Ownership
Now that you've won the bid, it's time fore you to take ownership of the property you have won. You need to insure that you receive the documents necessary from the auctioneer that demonstrate that you are in fact the winning bidder. Next on your list, contact a real estate attorney. He or she will help you ensure that you take the appropriate steps for establishing ownership and help you ensure clear title.
