Auctions are fun, exciting and very entertaining venues. You can be very successful if you bid with your head and are familiar with the process. We have provided this section to describe some auction basics.

First of all there are 2 types of auctions Absolute Auctions and Reserve Price Auctions. There can be modifications as well like Reserve Auctions that are subject to confirmation.

Absolute Auctions

Absolute auctions are sold to the highest recognized bidder regardless of price. The word "recognized" is very important here. You should understand that the auctioneer has the right not to "recognize" an initial bid in any type of auction. Why is that? Because the opening bid should be a reasonable bid. An opening bid that is ridiculous would more than likely not be recognized as it is not reasonable to the commencement of the auction. If however the auctioneer chooses to recognize the bid in an absolute auction the auction must continue and the item or lot is sold at the highest recognized bid even if there are no other bid increases or other bidders.

Here is a hypothetical example to help explain this. Lets say a diamond ring worth approximately $1,000 was being auctioned and the auctioneer said something like "and $500 to start it where". Now no hands go up in a few seconds and someone yells out "25 bucks". Legally the auctioneer does not have to recognize the bid and will more than likely just call for the next item. On the other hand if the $25 bid was recognized and the auctioneer said something like "ok I have $25 and now $50 where", then even if there were no bid increase the $1,000 diamond must be sold for $25 because the bid of $25 was recognized. In short after the first bid is recognized the gloves are off and there is going to be a sale if the auction is absolute.

Reserve Price Auctions

Reserve price auctions are auctions where an item may not be sold to the highest recognized bidder. If the auctioneer says SOLD however (even by accident) then the item has to be sold to the highest recognized bidder even if the reserve was not met. SOLD without conditions means SOLD. More than likely if the item didn't meet the reserve the auctioneer would not say SOLD and just call for the next item and the item is then subsequently returned to the client. Once a reserve is met the auction of that item automatically becomes absolute.

SOLD Subject to Confirmation

In a reserve price auction an auctioneer can also say SOLD subject to confirmation. That may mean that bidding has gone as high as was possible at the auction but just shy of the reserve or that the client/owner of the item/lot requested to confirm the final sale price before committing to it. The auctioneer will then during or after the sale confirm with the client/owner to see if they will accept the bid or not. If the client says sell it then it's SOLD if not the item is returned to the client/owner or an alternate price is negotiated. This happens only occasionally and most of the time items that meet the reserve are sold. The auctioneer is in the business of selling not practicing how well they can pick up an item, spend all kinds of time and money marketing it just to return it back to the client/owner. When most auctioneers meet with a client they make sure that reserves are set reasonable or they simply don't get involved. You can be sure that if you come to one of our auctions that the reserves will be reasonable and more than likely set at a dollar amount that the owner(s) may not be 100% comfortable with but agree to so that an auction can take place. Most times the final sale price will be well beyond the reserve and can even be higher than anticipated final value. It's simply the way things are done most of the time. Why would an auctioneer waste his or her time and money trying to auction an item that is too close to a speculated retail price? It simply doesn't make sense.

The Fall of the Hammer and Hammer Price

There are many ways that an auctioneer can indicate that an item is SOLD or what is know in the business as the fall of the hammer. The auctioneer can say SOLD, actually hammer a gavel without saying anything, moon walk, say "you got it" or anything they choose as long as they are consistent in doing so to indicate that an item is in fact SOLD. Whatever the auctioneer chooses to do is recognized and understood as the fall of the hammer. The hammer price is the highest recognized bid price that the item sells for at the fall of the hammer.

How can I bid?

First you must register as a bidder. For our real estate auctions more than likely you will be required to leave a down payment, present proper ID and sign a document confirming that you understand the terms and conditions of the particular auction. Then you will be given a bidder number and more than likely a sample of the purchase and sales agreement and or other documents relative to the property and auction. Your bidder number is considered your receipt so keep it in a safe place or in your hand at all times. If you are not the high bidder your down payment will be returned to you following the sale upon the return of your bidder card and the presentation of proper ID (both).

How do auctioneers sell?

Initially a good auctioneer will stick with the first 2 people that the auctioneer identifies throughout the bidding process. That doesn't mean that the auctioneer doesn't see everyone else with a bidder card up it simply helps keep the auction organized and moving forward. It simply doesn't make sense to jump around to every single bidder sporadically as that can be very confusing for everyone. If one of the initial bidders drops out the auctioneer will immediately try and identify a new bidder with a bid card up and stick with those two bidders and so on until there are no other bids or rather until the fall of the hammer.

Hint: If you get involved and bid early (one of the initial or frequent bidders) you have the greatest potential to save money. It's better to be the person with the last standing bid than the person who has to beat it!

When can I take possession of what I bought?

At goods and estate auctions most times items can be removed immediately after the auction has completed or the next day in some cases. If an auction ran later than expected or for large items next day or scheduled pickup may be in order. Some auctioneers may even have smaller, delicate or expensive items brought to you immediately during the sale if they elect to and let you check out immediately. For our Real Estate Auctions or most real estate auctions you may take possession after the property closes escrow in most cases unless agreed to otherwise. It is really up to the individual auctioneer.

What guarantees are there?

All items sold are typically sold AS IS WHERE IS ONLY with no guarantees of any kind either expressed or implied. Do your research and inspections before the auction and not after you take possession because once it's sold it's yours in most cases. With real estate auctions most times there is a guarantee of insurable title. If the title cannot be insured then you would not be bound to the purchase and your down payment and other monies as may be relevant per terms and conditions of the particular sale would be returned to you.

What does Vestport Inc. Auction?

Exclusively Real Estate at this time however we can help you with estate sales and any other auctions as well. Call for more information.

Will Vestport Inc. buy estates and real estate outright?

Yes, feel free to run anything by us. Note: Regarding estates, an auctioneer cannot buy some items and auction off others. To buy some items and auction others is illegal and an obvious conflict of interest however if you simply don't have the time to schedule an auction and need to sell immediately we may be able to help in many ways by purchasing the estate or referring you to a qualified associate that is an expert in this field. Real estate without a minimum of 25% equity will not be considered for auction or purchase.

What if I received a foreclosure notice?

First of all never ignore the notice! That would be the worst possible thing that you could do. Contact your attorney immediately and the bank to see if something can be worked out and many times can be. We want to see you keep your property so act immediately and respond to any notice after you call your attorney first. If you do nothing you will more than likely default on the property and ruin your credit. You may be surprised at how banks are willing to cooperate and even adjust terms in some cases if you get involved immediately. The banks do not want to foreclose. For them it is expensive, time consuming and not too great for marketing loan products to say the least. So again take action immediately!

We hope that you have found this information useful.