Frequently Asked Questions About Auctions
Frequently Asked Questions About Real Estate Auctions
Definitions to Terms Frequently Used at Auctions
- When an individual or company needs to convert assets to cash, the quickest and usually
most cost effective way of doing this is to conduct an auction sale. To understand how an
auction sale works, you must realize that this method of sale is just that .... a method
of sale. There is nothing tricky to an auction, it's plain and simple supply and demand
economics. An auction congregates all levels of buying power, from developers to
end-users, from wholesalers to retailers. These buyers bid against each other based on the
values that exist in their market place. The competition that occurs between the buying
powers ultimately determines the "fair market value" of the goods or property
being sold. Because the auction process is done in an expedient manner, costs are
maintained at a minimum, and financial recovery is almost immediate.
- Fastest method of sale - there is an exact date of sale, thus lowering carrying costs.
- Solve access problems - have only one or two showings/viewings, not one for every
prospective buyer.
- Auctions are the fastest growing marketing method.
- Sets maximum market value.
- Because there are rarely contingencies, there will be no prolonged negotiations.
- Intense marketing campaign will result in increased interest and
visibility for your
sale.
- Sold "As-Is, Where-Is" - this relieves the Seller of many liabilities.
- Creates competition and an urgency-to-buy among informed buyers.
- Sellers can set a minimum bid on real estate while leaving the top bid open-ended; this
creates the opportunity to realize higher selling prices than if you were asking a fixed
price.
- Solve inspection problems - all testing and due diligence is performed prior to sale.
- If your property doesn’t sell on auction day, we will automatically list it for
you.
- Real Estate typically has a non-refundable deposit with a 45 day unconditional closing.
- Personal Property net proceeds are typically remitted to you within 5 business days with
prompt removal of the property.
- Estates or Division for Heirs - Heritage offers turnkey estate
settlement. Real Estate, furniture, antiques and collectibles can all be sold in one day,
thus relieving the executors, administrators and families of these tasks.
- Individual Property Owners wanting to sell their home or an investment
property.
- Developers wanting to "close out" an existing development and
move on to a new project.
- Companies going Out-of-Business - Real Estate, equipment and inventory
can be sold in one day giving you a "quick cash" sale with no collection issues.
- Attorneys and Trustees who want to lower their liability in the
disposition of assets and eliminate holding costs, thereby increasing the net proceeds.
- Government Agencies and Banks looking to put property back into the
hands of the private citizen.
- Our methods will eliminate holding costs and stop those negative cash flows that drain
away your investing potential.
- Economic instabilities and uncertainties could cause a marked decline in value.
- What is the present value of the CASH you could have TODAY
when compared to that unknown amount that you might receive at an unknown time in the
future?
- Insurance, maintenance costs, taxes, mortgage interest and payments continue to build.
- Auctions are a fast and efficient method of getting the highest fair market value for
your property. Auctions motivate buyers by encouraging them to bid in order to
acquire want
they want.
- Yes! We can sell the real estate and its entire contents on the same day.
- In an absolute or unreserved auction the property will sell to the highest bidder
regardless of the price. Traditionally, more bidders attend an absolute auction and
usually bid a higher amount.
- Yes. Before the sale, we will analyze your property and then consult with you about a
reserve or minimum price. This price is never advertised or disclosed to any of the
bidders.
- You can reject the final bid. We will continue to market your property for a short while
in order to obtain you an acceptable offer.
- Yes! Do not discuss the price of your property with anyone before the auction. That's
what you've hired us to do! Direct all inquiries back to Heritage.
- Bid in writing from an absent bidder which is executed by auction personnel. Many
Auctioneers offer the service of "bid orders", "call-in bids" or
"absentee bids". That is if you need to leave and your item has not come up for
bid yet, you can leave the highest bid that you would go to on the item. There will be an
assigned bidder to bid as if you were there, getting the article for the best price, not
necessarily the highest bid you left. Naturally, if another bidder bids higher than your
"order", "call-in" or "absentee" bid you will not receive
the item.
- Person who invites the bidding at certain increments and calls the final price.
Auctioneers are professional licensed individuals who are bonded by the State to protect
you. To better work for their clients, they maintain their education through seminars,
professional organizations and extended courses like CAI (Certified Auctioneers Institute)
at Indiana University. There are laws and requirements auctioneers must follow to keep
their licenses, so you are protected.
- Person who registers your name and gives you a bidder number, adds up your bill, and
gives you a receipt after you pay.
What is a Clerk?
- Person who writes down all auctioned items, the final bidders number and the bid amount,
so the Auctioneer will have a record and you'll have a receipt.
You are invited to view all the items prior to auction. Auctions are
one of the few places you are encouraged to handle and inspect the items for sale so that
you know what you’re buying. Traditionally, there are no resales - all goods are sold
as is, where is, no guarantees.
Before bidding, register with the Cashier. You will receive a bidder
card. It is your contract with the Auctioneer. Don’t lose it; you are responsible for
purchases made against that bidder card number. When the auction is ready to begin, the
Auctioneer will go over the rules, times certain objects will sell and anything else you
need to know. The Auctioneer will also answer any questions you have at this time.
- Price wanted at an auction.
- Person who helps the Auctioneer answer questions and take bids.
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