Public auctions have become a viable way for many real estate investors to purchase properties at a great bargain. However, if you’re new to the process, it’s vital that you understand some basic information about auctions before you begin bidding with seasoned attendees.

Below, the professionals at Greenways Real Estate & Auction in Covington, VA, go over a few must-know things about purchasing investment real estate at an auction: 

• There Are Different Types of Auctions: Auctions can be conducted either live or online. Attending a live auction gives you the opportunity to see whom you’re bidding against and often allows bids to come in at smaller increments than an online auction does. There are also absolute and reserved auctions. In an absolute format, the property is sold to the highest bidder no matter what the amount is, while the reserved method requires a pre-determined minimum bid to be met.

• You Must Have Your Financing in Order: Before going to a real estate auction, it’s essential to have your financing in order should you be announced the winner. Even if you will be getting a loan, you must be able to provide proof of funds. In some instances, payment will need to be made in full at the time of the auction, either by cash, cashier’s check, or a bank money order. Other auctions will have you pay a deposit once the bidding is over and collect the balance at closing.
• It’s Important to Research the Title & Property Details: Regardless of how great a deal seems, it’s important that you do your due diligence and thoroughly research the property and its title before buying. It’s possible for the property to have liens on it, which is essential to discover ahead of time because they can delay the closing or become the responsibility of the winning bidder. It’s best to learn as much about the property as you can since auctions are typically as-is sales.
• Auctions Can Be Cancelled: There are some homeowners that try to postpone or put a stop to an auction sale. These actions can change the status of a pending auction up until the day it’s scheduled to take place. Because of this, it’s always advised to verify that a property is still available and the auction will be moving forward as planned prior to heading to the bidding site.

Being prepared is the key to successfully purchasing investment real estate at an auction. Contact Greenways Real Estate & Auction at (540) 962-1155, or visit them online to view current real estate listings and subscribe to auction notifications.