Foreclosure auctions

If you open the paper these days, you are bound to see announcements advertising foreclosure auctions. You have probably even heard a story or two about someone who has gone to an auction and gotten an amazing property for a steal. You may be thinking about it yourself. Here’s what you need to know if you are interested in foreclosure auctions…

The foreclosure auction occurs after the bank has taken ownership of the home from the person who didn’t pay the mortgage. By law the bank is required to advertize the auction in the local paper of record for 3 consecutive weeks before the sale can be held. Most auctions require that anyone wishing to attend must register in advance with a bank check or other certified funds. The amount needed is usually somewhere in the $10,000 range and can be much higher. Additionally, buyers need to have their financing in place by the day of the auction. The bank does not want to wait to receive the proceeds of the sale.

Sometimes open houses are held before the foreclosure auction to give prospective buyers a chance to walk through the property and have a look. Most do not. In that case, bidders at the auction are bidding on the property sight unseen. The only time bidders may see the inside is when they buy the property. If after the sale a major defect is uncovered there is no recourse.

For buyers who can get the certified funds and are not daunted by what they can’t see on inside, the next hurdle is placing the winning bid in the foreclosure auction. This is where many buyers’ dreams of getting a steal are dashed. While the bank does want to get rid of the property, it is not willing to take a crushing loss. To ensure that this doesn’t happen, the bank will send a representative to the auction. If the winning bid is too low, that person will push the bid up and buy the property for the bank.

It is a misconception that all foreclosures are great deals. The price that a bank will sell a foreclosure for depends on what is owed on the property and what its market value is. If you are looking for a bargain, seek the help of an experienced REALTOR™.  Here at Pinkham Real Estate we know our local market, and we are happy to give your our informed opinion on the best values in condos, homes, land and commercial listings in Mt Washington Valley. Give us a call (800-322-6921) or send us an email today. We look forward to helping you find the place that’s perfect for you!

This entry was posted on Tuesday, January 19th, 2010 at 2:44 pm and is filed under Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.