| A foreclosure auction is a unique forum in which to | | | | any of these. |
| buy a property. Here are some tips for getting the | | | | Tip #4: Know what to bid |
| best possible deal at a foreclosure auction. | | | | Your strategy for monetizing the foreclosure will |
| Tip #1: Do your homework | | | | affect how much you should bid for it at the auction. |
| Before attending the auction, it's crucial to do your | | | | In other words, how do you plan to achieve a return |
| homework. When you bid on a foreclosure property | | | | on your investment? Will you make cosmetic changes |
| at a public auction, you cannot retract your bid. | | | | to the property and sell it shortly after buying? Will |
| Therefore, do as much research as you can on the | | | | you rehab it and then rent it out or sell it? Calculate |
| properties being offered at the auction. Ideally, focus | | | | your expected return and determine your maximum |
| only on one property, or just a small number of | | | | bid accordingly. Just be sure to take into account the |
| properties, so that you have some idea of their | | | | possibility that the property has more problems than |
| market value before bidding on them. | | | | may have appeared at first... and have a Plan B... and |
| Tip #2: Inspect the property or properties | | | | C. |
| It's highly unlikely that you'll be able to inspect a | | | | Tip #5: Be prepared to pay a deposit |
| property being auctioned. The home owner is hardly | | | | In most cases, you'll need to pay a deposit on a |
| going to be agreeable to a bunch of people assessing | | | | property you buy at auction. This is often 10 percent |
| their home, which they are being forced out of. | | | | of the winning bid price and must be paid on the day |
| However, you have nothing to lose by asking for an | | | | of the auction in the form of certified funds. In some |
| inspection. If it's not possible, be sure to drive to the | | | | states you will need to pay the balance of the |
| property and assess it to the extent you can. The | | | | purchase price on the day of the auction; in other |
| less you can find out about the property, the more | | | | states, you'll have 30 days to pay the balance. Be |
| you should assume the worst! In other words, | | | | clear on the rules that apply to the auction in |
| assume that the property needs significant repairs | | | | question and make sure you have what you need in |
| and improvements, and budget accordingly. | | | | terms of a deposit. |
| Tip #3: Identify any liens, liabilities and unpaid | | | | Tip #6: Stay rational |
| property taxes | | | | A foreclosure auction can be fast-paced and intense. |
| It's also imperative to conduct whatever research | | | | It can be easy to get caught up in a "bidding war". |
| you can to identify any liens, liabilities and unpaid | | | | Don't! Stay calm and rational, and stick to your plan. |
| property taxes attaching to the property. When you | | | | Only bid on the properties you've decided to buy and |
| buy a foreclosure home, you'll also be accepting such | | | | don't bid any more than the maximum you previously |
| liens, liabilities and taxes. If you're not aware of these | | | | decided to pay. |
| before you buy... you could be in for a nasty shock. | | | | Besides these tips to help you invest in foreclosures |
| So too, the existence and extent of these should | | | | during the auction, you need to educate yourself on |
| reduce the value of the home, which you should take | | | | knowing what are the best deals. can help you with |
| into account when bidding. Therefore, perform a title | | | | that too so check that out. |
| search and any other necessary searches to identify | | | | |