The following information is provided by A. J. Billig & Co., Auctioneers to assist you in understanding purchasing a property at public auction. The material in this form is general in nature and does not limit your obligations under the contract of sale that you will be required to sign.
- Why should I attend a real estate auction?
- How about some auction tips?
- What are the terms of the auction?
- What if the property is in poor condition?
- When can I see inside the property?
- Is my deposit refundable?
- Are there other expenses that I should know about?
- How long do I have to pay the balance?
- What if I am getting financing for the purchase?
- What is the bidding process?
- What are the different types of auctions?
- Where can I get more information?
If you have any questions that are not answered below, please Contact Us.
Para leer esta información en español, por favor lea: Comprando Propiedad Inmueble en Una Subasta
Why should I attend a real estate auction?
An A. J. Billig & Co., Auctioneers real estate auction provides a fair and open venue to purchase a property. The auction is organized and the rules are straightforward. You set your own price and bid what you want to pay. If you are the highest bidder, it is reassuring to know that you purchased the property for only slightly more than someone else. The auction provides an opportunity for a great value and is the fastest way to buy real estate. You know the results instantly. Finally, auctions are exciting and entertaining.
How about some auction tips?
- Arrive at the auction early, to give yourself time to inspect the property, register and ask questions.
- Do your homework. Find out how much similar properties in the area have sold for.
- Feel free to bring an expert with you, such as a knowledgeable friend, property inspector, contractor, real estate agent or appraiser.
- Be Prepared to bid. Bidding is simple. But if you're doing it for the first time, it can be intimidating. Here are some general guidelines provided by the National Auctioneers Association:
- Make sure you clearly understand the terms and conditions of the auction before making a bid (these will be included in the bidder packet you receive when you register).
- Listen closely to the auctioneer. The auctioneer will determine the increments of bidding. If you are having a bit of trouble understanding the auction chant, plan to listen for a few minutes and get a feel for it before you jump in and begin bidding.
- Be sure you make eye contact with the auctioneer when you bid.
- The process is fast, so if you wish to bid, quickly raise your hand or shout out loud.
TERMS OF SALE:
Your responsibilities as a purchaser are advertised prior to the scheduled auction date and will be read by the Auctioneer at the time of sale. Additional terms may be announced at the auction or may be posted at the sale site. Failure to comply with any of the terms of sale may cause you to forfeit your deposit and be responsible for the expenses to resell the property, as well as any deficiency incurred.
CONDITION OF PROPERTY:
Auction properties may range from excellent condition to poor condition. We will provide as much information as is possible in each situation. In many cases, properties offered at auction are in similar or better condition than properties currently listed for sale. However if you are looking for a property to renovate, an auction is an excellent way to buy a property that may need a 'little TLC'. You are welcome to bring someone with you to the auction, such as a contractor or home inspector.
The property will be sold "AS IS." Unless otherwise announced, the sellers make no representations or warranties about the condition of the property. The sellers will not make any repairs.
Generally, the property will be open for inspection on the day of the auction, typically one-half to one hour before the scheduled auction time. Properties are often available to view by appointment with the auctioneer. In the case of a foreclosure, the auctioneer does not have access to the property before the auction, but the property may be opened when we arrive to conduct the auction. See the auction advertisement or call the auctioneers for specific inspection times.
As a bidder, your certified or cashier's check should be made payable to yourself. If you are the winning bidder, you will endorse the check to the auctioneers. Otherwise, you are free to take the check back since it is in your name.
As the purchaser, your deposit will be credited toward the purchase price. If the "TERMS OF SALE" require you to increase your initial deposit (above the initial amount required at the time of sale), the Auctioneer will likely accept your personal or business check for the difference on the day of sale. Otherwise, you can bring, wire or messenger certified funds for the increased deposit within the time stated.
10% deposit (as specified in Terms Of Sale)
Deposit brought to auction sale
Remaining deposit due (within 24 hours)
You may be responsible for the expenses of owning the property as of the date of sale or as of the date of settlement, including taxes, utility costs and insurance. You may be required to pay interest on the amount of the purchase price, less the amount of your deposit, from the date of the sale to the date you settle for the property. The Terms Of Sale will outline your specific responsibility. We recommend that you obtain a fire and/or liability insurance binder on the property immediately as of the date of sale. As the purchaser, you will pay all of the settlement expenses, including title fees and recording costs. For specific rates, see the Maryland State Department of Assessments and Taxation web site for Property Tax information, and the appropriate Circuit Court Clerk's office for the Recordation and Transfer Tax information.
The settlement or closing period is specified within the terms of sale. If settlement is based on ratification by a Court, the ratification period is typically thirty to sixty days, but might take longer. In these cases, settlement will typically take place within 10 days of the court ratification. In all cases, you will be expected to settle for the property within the specified time. You may select your own title company or attorney to handle the closing
Although the auctioneer does not require that you are pre-qualified for a loan, it may be helpful for you to know your limit before attending the auction. We will be happy to recommend sources of financing and often provide a link on the property web page. See our Financing Page for a list of auction-oriented lenders.
It is the purchaser's responsibility to obtain financing. If you plan to use a mortgage to purchase the property, we recommend that you apply for the loan immediately. If the bank must take longer than the specified time to complete the loan, the sellers may extend settlement for a short period if you can provide proof of a loan commitment. If you do not obtain the financing within the specified time for settlement, you will be in default of your contract of sale. Of course, you can also pay cash.
On the day of the auction, the auctioneer will arrive at the property at least one-half to one hour before the auction time. See the Inspection section on this page for more details. We recommend that you arrive at the auction early, in order to have enough time to register with the auctioneer and to tour the site. You will need to show the auctioneer that you have the required deposit which qualifies you as a bidder.
Before the bidding starts, the auctioneer will make important announcements regarding the property and your obligations as a purchaser. Please feel free to ask any questions regarding these announcements and the terms of sale.
At the conclusion of the announcement and question period, the auctioneer will solicit bids for the property. Bids are generally made either orally or by raising a hand. Bidding increments are made in amounts acceptable to the auctioneer, who may set a minimum bidding increment as the sale progresses. Any bid that is merely a nominal or fractional advance may be rejected by the auctioneer if in his judgement it may affect the sale injuriously. If a dispute arises between two or more bidders, the auctioneer shall decide in favor of one of the bidders, or immediately re-offer the property.
TYPES OF AUCTIONS:
- Trustee's, Substitute Trustees' or Foreclosure Auctions
Most of our company's foreclosure auctions are conducted on the premises. A deposit, which is advertised under the "Terms of Sale," will be required of the successful bidder at the completion of the auction. The balance of the purchase price is due when the sale is ratified, or approved, by the court, which usually occurs in 30 to 60 days. In Maryland, unlike other states, there is no right of redemption by the debtor on the foreclosed property. Once the auction is completed and the sale is ratified, equitable title is transferred to the purchaser and legal title will pass at settlement. The property is sold free and clear of all liens unless otherwise advertised. It is the purchaser's responsibility to obtain possession of the property if the previous occupants do not leave on their own.
- Bankruptcy Auctions
Bankruptcy auctions are similar to foreclosure sales in that a distressed situation exists. Free and clear title is also guaranteed, but no ratification is required by the bankruptcy court. Settlement times, deposits, and terms of sale are advertised prior to the auction, as in the case of a foreclosure.
- Attorney's Auction
An attorney is representing the owner of the property. There are a variety of situations where an owner would choose to have their attorney arrange the sale of their property for them.
- Partition Auction or Dissolution of Partnership
Partition sales involve marital disputes or partnership disagreements, and may or may not be conducted under a court order.
- Estate Auction
The owner of the property has passed away and the property is being sold for the estate of that person. The estate may be handled by an attorney or by a family member acting as the personal representative.
- Guardian's Auction
A guardian has been appointed to handle the affairs for the owner of the property.
- Receiver's Auction
A receiver has been appointed to arrange the sale of the property in the same manner as a trustee.
- Public Auction, Real Estate Auction, On-Site Auction
Sellers Section to read about the advantages.
- Absolute Auction
The property will be sold to the highest bidder regardless of price! There is no minimum reserve price on this property.
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Sources for more information:
Note: The following web sites are listed here for informational purposes only.
Baltimore City - CityView
Provides maps, lot outlines, neighborhood info., public schools, plus aerial photos
Neighborhood Information from LiveBaltimore.com
Neighborhood descriptions and other home buyer information
Baltimore County's My Neighborhood
Provides maps, property lot outlines, zoning maps, aerial photos and more.
Public Schools in Maryland
Links to all the local school districts in Maryland
Annotated Code of Maryland, Real Property Article, Section 10-702
Maryland Government - Maryland Manual On-Line
A guide to Maryland government, including: Code of Maryland, Land Records, Maryland Counties and all branches of MD government
- Baltimore City
- Transform Baltimore
- Zoning Code
- City Charter & Codes
- Transform Baltimore
- Baltimore County
- A Citizen's Guide to Zoning
- Zoning Code
- A Citizen's Guide to Zoning
- Harford County Planning and Zoning Department
- Anne Arundel County Planning and Zoning Department
- Prince George's County Zoning Information
- Montgomery County Zoning Information
- Frederick County Planning and Zoning Department
Zoning Code, maps, and other information
- Howard County Department of Planning and Zoning
Zoning Code and other information
- Other Counties' Zoning Codes
See the county's web site below
Counties in Maryland
- Allegany County Government Web Site
- Anne Arundel County Government Web Site
- Baltimore City Government Web Site
- Baltimore County Government Web Site
- Calvert County Government Web Site
- Caroline County Government Web Site
- Carroll County Government Web Site
- Cecil County Government Web Site
- Charles County Government Web Site
- Dorchester County Government Web Site
- Frederick County Government Web Site
- Garrett County Government Web Site
- Harford County Government Web Site
- Howard County Government Web Site
- Kent County Government Web Site
- Montgomery County Government Web Site
- Prince George's County Government Web Site
- Queen Anne's County Government Web Site
- St. Mary's County Government Web Site
- Somerset County Government Web Site
- Talbot County Government Web Site
- Washington County Government Web Site
- Wicomico County Web Site
- Worcester County Government Web Site
To read an article written by Daniel Billig about
public auctions, click on the following link:
THE PUBLIC AUCTION:
A marketing tool for today's Realtor