The Auctionator - The Illinois Builders Clearing House

FAQ Auctions

What is a real estate auction?

A Real Estate Auction is a method of buying and selling real estate. It is an intense and accelerated real estate marketing process that involves the public sale of property through open, competitive bidding.

Back to top

What are the general differences between a public auction and a foreclosure?

Generally, a public auction is for sale by owner. The owner is not in financial distress, but has merely concluded that selling his/her property via the auction process is the most effective method

A foreclosure, on the other hand, is a forced sale by creditors. These auctions are sight-unseen and are generally held on the courthouse steps of whatever county the property is located. There are many more differences that are examined later in the FAQ section.

Back to top

What do I need to bring to the auction in order to bid?

* A valid, photo ID. State ID, Driver’s License or Passport are acceptable.

* A Cashier’s check or Certified Check for $5,000 made payable to you.

* Mortgage pre-approval letter or Certification of Funds from a legitimate financial institution.

* Personal, Company or Bank Check for the balance of 5% of the purchase price of the property you successfully purchase at auction.

Back to top

Are auction sales contingent on inspection?

Auction sales are completely non-contingent for any terms. And, therefore considered to be sold “as is”. However, new construction may offer certain warranties on a case-be-case basis as provided by seller.

All buyers are encouraged to inspect the property(s) to their satisfaction PRIOR to the auction.

Back to top

If I win the auction, what happens to my deposit money?

The deposit will count as a credit towards the purchase price of the property and placed in escrow. Please note; it is the purchaser's responsibility to obtain financing. If you plan to use a mortgage to purchase the property, we recommend that you apply for the loan prior to the auction. For the buyer’s convenience there will be loan professionals available at the auction to assist with financing.

Back to top

What happens if for some reason the buyer cannot settle on the property?

A well-conducted real estate auction by its very nature minimizes such failures. Failure to close can happen, but it isn't frequent. If the rare failure to close occurs, the auction seller can turn to the next highest bidders, who demonstrated their willingness to pay nearly as much as the buyer who failed to close.

If the buyer fails to settle on the property, he/she will be considered in default of the sales contract. In this instance, the buyer might lose all or part of their deposit and potentially be responsible for the cost of reselling the property.

Back to top

When can I inspect the property?

For our public auctions, inspection dates are published on our website. You can also call our office at (708) 645-2001.

Back to top

What happens if for some reason the seller cannot settle on the property?

Our service contract states that the seller must be able to deliver free and clear title to the property without any liens or judgments. The Auctionator, Builder Clearinghouse nor the auctioneer do an independent title search. In the case that free and clear title cannot be delivered by the seller, the seller will be considered in default and the buyer will be refunded his/her deposit.

Back to top

Who is responsible for closing costs?

Buyer and seller are responsible for their respective, reasonable and customary closing costs.

Back to top

What is an absolute auction?

An absolute auction is a public auction without a reserve or minimum. This means that the property, once the auction begins, will be sold that day.

Back to top

What is a reserve auction?

An auction in which the seller reserves the right to establish a reserve price, to accept or decline any and all bids or to withdraw the property at any time prior to the announcement of the completion of the sale by auctioneer.

Back to top

What is a Minimum Reserve Price?

The minimum price the seller is willing to accept for a property to be sold at auction. This number is confidential and does not necessarily reflect the opening bid on the property.

Back to top

What is the Buyer's Premium?

The buyer's premium is a service charge that is added to the high bid for our public auctions. The Auctionator / Builder Clearinghouse charges a 5% bidder’s fee. This is added to the final, winning bid amount and included in the contract terms.

Back to top

What are the advantages to a buyer in an auction situation?

The buyer knows the seller is fully committed to sell; usually at a significant amount below the original asking price. Auction agreements obligate the seller to transfer title to the highest bidder in an absolute auction; the auction agreement obligates the seller to transfer title to the highest bidder that meets or exceeds the reserve price in a non-absolute offering. The buyer has negotiating power. The buyer can withdraw from the bidding at any time until the gavel falls. The buyer sees many offerings in the same place at the same time and is able to make market comparisons quickly and easily. The buyer is satisfied that he/she has secured the property at a “good price”.

Other benefits are:

Buyers set their own purchase price.
Auctions eliminate otherwise long negotiation periods.
Auctions reduce time to purchase property.
Buyers do not have to worry about contingencies because purchasing and closing dates are known.
Buyers know property owners sell at lowest price possible.
Buyers can receive favorable financing.

Back to top

How long to I have to close on the property?

The time frame varies depending upon the type of property auctioned. Generally, our contracts stipulate a 30 day settlement from auction day to closing. Please see the specific terms for each auction to determine the length of time to close.

Back to top

Does The Auctionator / Builder Clearinghouse pay broker fees?

For our public auctions we will pay properly registered buyer’s brokers a referral fee provided the property to be auctioned is not actively listed with a Licensed Real Estate Broker offering co-operating compensation via a MLS service.

Please note, buyer brokers should register at least 24 hours in advance. There is a form that must be completed with our office. Verbal agreements are not acceptable.

Buyer Brokers must personally attend the auction with their buyer(s).

Back to top

If you have further questions, please feel free to contact our office at (708) 645-2001.