Just curious about the "costs" during a sheriff's sale auction. If the upset price is $35,000 and the costs $5,000 and you win the bid at $35,000, would you pay about $40,000 to buy it and close? Thanks.
Also, one other question. I've seen seasoned sheriff sale buyers make a lower bid on a property right after the bank makes a large bid. For example, property at 123 Main St is up for auction. The bank says their max bid is $125,000 + costs. The potential buyer makes a bid of $60,000, then the bank $65,000, then the guy $70,000, then the bank $75,000, then the guy stops and the bank takes it. The bank already said their max bid would be $125,000 so what is the benefit of the guy to try and undercut them. I know there is a reason for this because the gentleman is a very active buyer but don't know what it is. Can anybody shed some light on this?
I'd be interested to find this out too.
I've never heard the bank state their maximum price. I have seen a bank pay above market value for properties at auction by out bidding investors...silly bank.
@Austin Hughes ...well we're both interested to hear some experienced responses. No luck yet!
Banks commonly reveal their maximum bids here. The reason is that they have to pay 2.2% of the final bid price in fees to the clerk as high bidder. So, if they show their max bid at $125k, and investors are only willing to pay $100k they usually won't bother bidding, and the bank takes it back for the $100 minimum opening bid. 2 reasons I can think of for an investor to bid it up, but below the bank's max bid.
1) Trying to show the bank what investors might be willing to pay, hoping to influence the price they can later buy it for, probably useless
2) We had one auction rep who represented a bunch of banks, and was a real prick. So, I bid the prices up on most of his cases to what I would have paid for them even though it was less than his reserve. The reason, and he asked me directly so I told him, was maybe the banks would realize He was costing them an extra $1000-$2000 on every property he handled for them, and get rid of him.
Thanks @Wayne Brooks . I assumed it was to show banks what he would pay and his bid would be recorded (maybe for a deal later). The guy I'm referring to def has a reason for it that benefits him. I've bought two times at sheriff's sales - I just wanna get better at them. I just get the feeling that everyone knows so many more tricks than I do. Do you have much experience with sheriff's sales? Would you mind if I message you with a few more questions?