Buying Colorado Real Estate at Auctions Part 2
(Continued from “Buying Real Estate at Colorado Auctions”)
So now you have scoped out the auction scene and have taken note on interesting properties. After noting the details and contacting your real estate agent and/or attorney, are you ready? Do you know the terms and conditions of the real estate auction where you will bid? Be sure to have your finances in order and let’s go.
Zeroing-In on your Real Estate Auction
Begin your in-depth analysis by touring the farm, ranch, land, or home that piqued your interest. Walk the property, preferably through a tour given by the auction house or someone knowledgeable about the real estate. If this is a forced sale, arrangements may be more restricted. The former owner may still hold the title. Regardless, be sure to have permission to enter any private property.
Financing
Ask your real estate agent to supply a list of comparable properties in the area. These comps will give you a clearer standard and guide for your bidding. If you plan to use financing these comps become important for the bank to make decisions. Do get pre-qualified as necessary. Many auction rules require a down a payment during bidding as a safeguard. The highest bidder often needs to pay the full price when the auction ends.
Potential Problems
There can be some unexpected turns. Careful planning ahead of the auction will pay off in the end so you can feel confident in your real estate investment.
- Sometimes a property may be auctioned but still occupied. You may need to file eviction notice to take possession. In many cases, a civil complaint and lawsuit may be in the cards.
- Buyers often need to buy title insurance, especially if they receive a quick-claim deed.
- Auctioneers and sellers may offer warranties to guarantee against future problems.
- Not all auctions allow mortgages.
- All liens on the property will be the responsibility of the highest bidder.
Time for the Auction
Confirm the time, date, and location of the auction. Come a half-hour early to register and fill out forms. Be able to prove you can pay if you are successful. When the bidding starts, the auctioneer will announce a minimum bid. Bid until you reach your limit. If you do win, it is time to complete the purchase and pay for your new real estate.
On the other hand, if you have been pre-approved, then you will sign a mortgage agreement. At closing comes the closing disclosure, escrow statement, and a promissory note saying how much you owe the bank. Closing may take another 45-60 days. The property will be yours when you pay the purchase price.
Colorado Real Estate Auction
The offices of Auctioneer Gene Cruikshank and Cruikshank Realty are at 20 S. Main Street, Lamar, CO 81052. For more information about buying or selling homes, land, farms and ranches at Colorado auctions, please call at (719) 336-7802. Auctioneer Licensed in Colorado, Oklahoma, Kansas, and New Mexico.