When homeowners are not able to make payments on their house each month, they are often evicted and the home is foreclosed. These foreclosed homes are then put up for auction and members of that public who might be interested in purchasing the home can bid on it. As a bidder, you would want to purchase the home at a good price while scoring a great deal. This, however, is only possible if you thoroughly do your homework before bidding day.
You need to learn the rules of bidding
The rules and regulations of a foreclosed home auction may vary from state to state, thus you need to know what is expected of you. Before you start bidding on foreclose homes, you need to attend one or two of these auctions and observe how the proceedings take place. By doing this, you can build experience. You also need to remember that these homes are sold “as-is” and it is up to you as the bidder to repair the home if needed. As the previous owners were evicted, the house may be in a bad state. Take this into consideration before bidding and have a look at the condition of the house before setting down your bidding price.
Speak to a realtor
Realtors can give you a huge amount of advice on the home you intend to bid on. Depending on the location of the property, the bidding price may vary, thus you need to consult with a local realtor.
Bidding on a foreclosed home
When settling on a price for the home you intend to bid on, you need to choose a price within your budget – one that you would be able to afford. The price, however, needs to be of such a standard that the bank would consider selling the house to you. It is a good idea to research real estate prices that are current so you don’t set your bid too high or too low.
When the bidding begins
It is a known fact that when a bid begins, the pace is very fast and with quite a few people bidding on the same house, you can get caught up in the adrenalin rush. Make sure to stay calm and collected as you don’t want to lose the bid due to your emotions getting in the way. While countering fellow bidder’s offers, you need to keep your maximum price range in mind as you don’t want to overspend on the house.
If your bid wins, you will be asked to make a deposit on the home. Thus, you need to bring cash to the auction and make sure you’d be able to make down payments on the house thereafter. With that said, you might be the proud owner of a new home and with a few repairs, the house you bid on can actually become a place you can call home!