As real estate auction services become a more popular method of selling residential and commercial real estate, sellers are frequently left in the dark about the options they have when pursuing auction to sell their property.
Absolute auction also known as Without Reserve Auctions, these auctions create the most reliable auctions from a buyer’s point of view. The vendor has obligations to sell the property to the highest bidder. The high bidder usually signs the purchase and sale agreement at the end of auction, deposits their cashier’s funds, and then immediately receives an executed copy of the contract.
A minimum bid auction is one in which the vendor guarantees a sale if the price reaches the minimum bid which is usually published. This is a safe technique of selling real estate because the owner of the asset knows that the property will sell for at least a certain amount, which they have already established.
Properties offered with reserve are auctioned in a similar fashion. However, the acceptance of the offer is subject to approval or confirmation of the vendor. This strategy minimizes the seller’s risk by allowing the seller to reject the high bid price, usually within 48 hours of the sale. The high bidder would still be compelled to sign the purchase and sales agreement, with an irrevocable warning, which provides that the purchaser agrees to allow the seller a stage of time to consider the offer.
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