As a first-time homebuyer, chances are you spend a lot of time on the internet or speaking with real estate agents in an attempt to learn everything you can about this process. You've checked out several houses online and even attended a few open houses. However, if you are looking for a non-traditional way to purchase luxury homes for sale at a great price, there is another avenue to explore: real estate auctions. If this is your first experience at a real estate auction, here are a few tips to get you started:
Get to Know the Neighborhood
After finding a list of future real estate auctions, it's time to start during your homework. Begin by narrowing down the search based upon your budget, home size, and preferred neighborhood. Next, begin researching the neighborhoods where the homes are found, paying attention particularly to the prices that comparable properties have sold for in the past.
Use this information to help determine the maximum bid you are willing to place. Remember, you are bidding on a home at auction to save money, not potentially spend more money on a home than it is worth. Additionally, take a look around the property and check for any structural defects or other flaws that could impact the home's value and your bid.
Get Your Finances in Order Right Away
Now that you have decided to take the plunge and buy a home, it's time to get your finances in order. In the majority of states, you will need to pay for the home in full on the date of the auction. In a handful of states, you will need to pay a small percentage of the home's price on the day of the auction, and the rest of the money in a set amount of time.
Learn about your state's real estate auction laws to determine how much money you will need to bring with you. Next, you will need to either secure a cashier's check, a money order, or cash to bring with you on auction day. Remember, the amount of money you will need to bring with you on auction day is dependent on your state's laws.
Bidding at the Auction
The big day has finally arrived and you're ready to begin bidding at auction. Begin by calling the home's trustee to determine if the auction is still being held. Next, arrive at the auction early, secure your paddle, and find a spot to begin bidding. Don't be intimidated by the other bidders, and don't spend more money than you believe the home is worth.
If you win the home, locate the home's trustee or the real estate lawyer who is in charge of selling the home and complete the necessary paperwork, which typically includes a certificate of sale. You will also need to secure a deed or certificate of sale. You will receive the actual title for the home in a matter of days after the auction.
Securing your first home at auction can be both confusing and exciting. The best way to begin prepping for the auction day is to do your homework, which includes researching the property and getting all of your finances in order.