Real Estate Auction Action - Buying A Home At AuctionJakob Jelling Due in part to the popularity of the U. S. Department of Housing and Urban Development HUDs home auction program, more potential homebuyers than ever are buying homes at auction. Homes for auction arent limited to just HUD, however. Many government entities auction homes for payment of back taxes, and some homeowners even auction their homes on eBay.com! Homebuyers considering buying a home at auction should take some steps in advance to help them with their bid price, and even whether to bid at all on a specific home. There will always be a degree of risk when buying a home this way, but with a little diligence, potential homebuyers could save a lot of money buying in this manner. Before the auction, you should have your financing arranged, and have enough cash on hand or in your bank account to cover a deposit on your purchase. You need to check the features, location, condition, and ownership history first. Afterwards, be sure to learn what the property is worth by looking at sales of comparable properties in the same area. Compare homes with the same number of rooms is possible, but be sure to allow for price differences due to pools, decks, carpeting, window treatments, etc. At the auction itself, resist the temptation to get into a personal bidding war, just "to beat out the other guy". Have a set price limit and stick to it. Other houses will come along, and you dont have to win the first auction that comes your way. You should know that the price of a home at auction is typically the loan balance if foreclosed, plus any back taxes owed, plus legal fees and other expenses in foreclosing the property. This will typically be the opening bid amount, and the price will go up from there. Even so, its possible to get a great deal in an auctioned house, with a little research and planning first. Also, know that you probably wont be able to get an inspection, and are buying the home "as is". If you cant do any needed repair work yourself, or cant hire it done within your budget, you may not end up getting such a bargain in the end.
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