Every auction I have ever heard of (tax, mortgage etc.) require cash payment within days and sometimes hours of your accepted bid. As such, I bet it is pretty hard to do a No Money Down deal at auction, as I understand them.
I too am new at REI. In fact, I don’t own even my first investment property (YET!!). A good start is to read the How To articles on this site. There are some on profiting on auctioned property. There are also a lot of good resources offered through this site as far as courses, books etc.
Posted by Kevin Frazier on May 12, 1999 at 08:45:38:
I have been watching this site for about a year, and I have had an interest in getting into real estate for a few years.
There is a nice brick house in my neighborhood that is going to be auctioned in the next few weeks. Being new to this, I was wondering if anyone could help point me in the right direction of how I could purchase this home, either with no-money-down or with little-as-possible. I have seen alot of courses and talk on other techniques, but I haven’t seen anything that talked about auctions. I wouldn’t mind getting a course or a book, but I don’t have much time before this house goes up for auction. Can anyone help?
I have picked up couple of good deals through auctions. But, I very much doubt you can get any deals in auction with little or no money down. At auctions, you have to pay a non-refundable deposit (usually five thousand cash or more), and have to have a closing take place within some time limit. This is NOT subject to FINANCING, INSPECTIONS, or anything else. So, you have to be very very careful. You are buying the house “AS-IS”. You have to take care of evicting the previous owner or the tenants in the house. You are buying it subject to all the liens against the property, sometimes backed taxes, other mortgages, etc. So you have to do your homework well before you go to the auction. AND MAKE SURE you can AFFORD to pay and closed on the house, or you’ll lose your deposit.
And if you are confidence enough, yes, auctions are good way to pick up properties. I start out investing in this area. If you know what you are doing, yes, you can make a lot of money.