Real Estate Auctions are all around you, in many forms. One of the more common forms for consumers is held by a company called REDC or Real Estate Disposition Corporation. There are many companies out there similar in form and function to REDC. If you google them, you should find them without issue, however understand this company does add a significant service commission to the transaction, (which most auctioneers do) moreover you will have serious competition at these auctions becuase of their heavy advertising to the public. Although I am not the largest proponent for this type of auction platform, I have been to a number of these functions, and it would be a good place to get your feet wet - although if it is your first auction, I highly recommend going without the intention of buying to get an understanding for how they work, and the energy produced.

Moving on, another type of auction is a public auction held by State or county. These are less frequent and purer in form. Typically harder to find, you will notice significantly less competition at these auctions although the investors you do encounter you can expect to be well versed and experienced. To find thee auctions I suggest looking at your County's website or if they are not so technically advanced yet, paying them a visit in person.

Another option is to pick up NOD lists (Notice of Default), and research specific properties that interest you. If the current owner is unable to get out of default the home will go up for auction. These auctions are very rarely attended by anyone else other than the current lender. Known as a trustee sale, the bank holding the note will usually open bid for the amount they are owed on the property, due to lack of bidding at these sales this is usually the closing price, and the bank leaves the formal owner (the property is now officially bank owned). If however their was a second bidder (you for example) that bid higher than the bank, and the bank did not counter, you could outbid the bank and become the new proud owner.

A final point to consider. Buying at auction can save you significant money, but it comes at a risk. Buying at auction means you are buying as is, and the seller provides no warranties as to the quality of the property. This means you must be diligent in your intitial research as to identifying properties that are structurally sounds, have clean title, and will pass inspection without issue. If they don't understand you will be on the hook for whatever the cost may be.

Due to the differences in real estate practice across state lines, I highly recommend researching and even contacting a real estate broker within your state that understands how your state laws function in disposing of real estate and auction law. I am native to CA and can only share with you my professional experience within this State.

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