Regardless of who hold auctions, is the winning bid real the total cost of buying a house from the auction?

4 Comments

1. Tom says:

   March 4, 2010 at 7:51 am

   Yes, those are the selling prices and they sell just like cars, plus taxes, title and registration. There are fees associated with any real estate transfer, but they are only a fraction of the selling price. Most states have a deed registry fee that is based on the selling price and that is the main additional expense. There will also be fees for actually writing the deed.
2. tmorrow65 says:

   March 5, 2010 at 7:03 am

   It’s very difficult to actually get a house at auction at extremely low prices like that. I’ve been to quite a few and actually won the bid on a couple of them. BUT… where I’m at, there is a 10 day upset bid timeframe where anyone can outbid you still but they have to up it by 3%. Or the owner still has that time to pay the lender back. That’s in the normal case of foreclosure. The sheriff auction thing does not state that there are no other leins or mortgages on the property. I talked to the sheriff about this before and they just won’t say. You have to do your own title search before bidding on this. So the winning bid can be the total cost of the property if you make it past the hurdles. And it’s hard to find any good info online that they’re not charging you for. Or they’re making it look soooo easy, but it’s not. That’s just to sell you.
3. rlloydevans says:

   March 5, 2010 at 6:27 pm

   It depends on the auction. Most auctions have additional fees that must be paid, so on each one you must read the auction fine print. Most will have an auction fee of 5%-15% added, plus possibly other fees.

   Also you have to do your homework on auction properties. While some are great bargains – yes you can buy some properties for pennies on the dollar – these are often properties with severe problems. The good properties are snapped up by investors at 60-70% of Fair Market Value. If you pay more you must realize these are often houses that have been standing vacant for 6-12 months. Windows will be broken and ac units stolen, graffitee painted on the walls. and have lots of rehabbing that must be done.

   Also, I have seen properties sold that are legally hazardous dump sites requiriong $100k’s of dollars of cleanup. Also Many auction properties do not come with clean title. There can be additional mortgages or tax liens left on the properties that become the new owners responsibilities.

   And of course, you almost always have to have a certified check of several thousands of dollars for the same day deposit, plus have all monies in place to be able to finish paying for the property in 7-15 days, so you have to have all cash quickly available – no conventional financing here.

   Yes, it is possible to buy properties extremely cheap at auctions. however the good ones have lots of competition and there are lots of potential problems waiting for the person who doesn’t do their homework.
4. candleslightup says:

   March 8, 2010 at 7:03 am

   Yes, it is really the cost of the house. Although usually depending on who handles the auction there is a fee that is associated with filing, titlling and deeding expenses. Call the local county which the auction is being held.