Is It Advisable To Buy a House at Auction?

You can always buy properties through auctions and not go with traditional methods. There are certain benefits of buying a property through an auction. You can acquire it at a discount and chances are that you will face relatively less competition. The drawback is you might have only a limited knowledge of the properties and quote more than what it is really worth. You will have to get an attorney who will guide you through the paperwork and the final sale.

Properties are auctioned when the owners have not paid the mortgage for a few months. A default notice is filed by the bank and if the buyer is unable to renegotiate with the lender, the lender can put up the property for auction. These auctions are usually held by the banks. It is a slightly risky way to buy a property but if you have knowledge about the market the auction process, it is a good way.

Another type of auction is when the owner is unable to pay the property taxes. In this case, the tax authority gets hold of the property and the auction is directed by the local sheriff or the comptroller’s office. These auctions are advertised through local governments and real estate brokers on online auction websites. They do not permit or sanction an inspection of the property. You must go to the estate agents if the property is deteriorated or in a risky condition. You must have a clear understanding of the auction rules and you must check for claims, occupants, and liens before bidding. These auctions take place at the courthouses and conference rooms and sometimes, even online.

Getting All the Information

To find out about the auctions, one must communicate with the local governments or visit the websites. Local brokers can also provide information, but they may not help because they do not earn commissions on such auctions. One can work with the real estate agents, contractors, and appraisers to get an estimate or valuation of the property and even the remodelling cost. You must also be aware that these auctions can be annulled or suspended at the last minute.  You must always be ready to follow the rules of the auction. Do note that you will have to register and pay a deposit which will be about 5 to 10% of the property’s price.

These auctions generally work in two methods. The first is when the lender does not have to accept your offer even if the bidding is the highest and the second is an absolute auction in which the highest bidder wins. Most of the time, these properties are sold at less than their true value. If there is a profit, the homeowner gets it after the mortgages are paid. In order to bid at the auction, you need to bring cash, check, or money order. You will have to pay the whole amount as soon as you win, or you will not be allowed to take over the house.

Whether you’re looking to buy or sell in the Kamloops area, for a greater probability of success you need a dedicated professional. I can guide you through the process and be counted on to protect your investment!

Categorised in: Buyers, Kamloops, Real Estate

This post was written by kamloopshomesearchcom