Due Diligence: SC Homes @ Auction.com

DUE DILIGENCE
pre- process before placing a bid

due diligence, or doing your research, is one of the most important steps you can take before buying a property.
... when bidding on a distressed bank-owned or foreclosure property.

steps to take before placing a bid.

1. view the property details page.
photos,
property information reports,
title insurance information,
tax information,
The purchase agreement,
addendums
And more.

2. Investigate the Property and Surrounding Neighborhood

If the property is vacant and interior inspections are permitted (see “Gain Interior Access on Select Properties” 

3. Hire a home inspector to assess it.
The property details page will have an ICON under the bid box that says “Interior Access Available.”

Ask an agent to recommend an inspector or you can find one through a national association such as: ASHI and InterNACHI.

IF occupied by former owners or tenants,  you will not be able to access the property.

BUT there are still ways to investigate
A.  Take photos of the outside of the home.
B.  Check out the neighborhood.

C. Estimate the Home’s Value and Repair Costs

D. How much will it cost to renovate
New roof
Paint
other
appliances
painting the interior,

Review Documents on Auction.com

property information report,
title report,
Purchase agreement and addendums. 

Reserve Price,

 Est. Debt,

 Est. Resale Value, 

Previously valued price

Downloadable documents - intended to provide preliminary information only, we recommend obtaining a full title report.

To purchase a full title report,  

Contact a closing company. 

A real estate agent can also recommend a closing company. 

A full title report will show you exactly what’s on the title and will indicate if there are any liens for items like unpaid taxes or 

 Financing

“Cash Only” or “As-is” basis. 

because lenders are not willing to provide mortgages on occupied properties since the interior cannot be inspected. 

 will need to show Proof of Funds within 24 hours of winning the bid.

. Proof of funds include

 Bank statements, 

brokerage accounts, 

Or any funds that are immediately available.

You may also want to request a liability insurance quote. 

Check with your insurance agent to find out how much liability and property insurance you may need.

To ensure that you are prepared to bid, consult a local real estate attorney to identify other things to take into account when performing due diligence.

REVIEW PURCHASE AGREEMENT AND ADDENDUM

 to ensure that you are informed about the unique terms of the agreement for the property 

The bottom of the properties detail page within the “Documents” tab. 

The seller dictates the terms of the agreement, 

The agreement explains your rights as a buyer, along with the seller’s rights. It may include items such as:

Access to the property, if allowed

Financing conditions, if permitted

Buyer’s Premium, if applicable

Closing fees and which party pays for them

Title insurance and deed options

Review the agreement with a real estate agent or attorney. 

It is crucial that you are clear about the terms of the agreement prior to bidding because if you become the winning bidder, you will be required to complete and sign the agreement within 1 business day of receipt.

Real Estate Purchase Addendum

The addendum is part of the purchase agreement so you will be legally bound to comply with it. 

located at the bottom of the properties detail page, under the “Documents” tab.

DUE DILIGENCE ON OCCUPIED PROPERTIES

research the schools and 

crime rate. 

 do not disturb the occupants or 

trespass on the property.

If the occupants are tenants you may want to research eviction laws.

GAIN INTERIOR ACCESS ON SELECT PROPERTIES

On select properties, interior access is allowed. 

Contact the agent on the property details page to gain access. 

If an agent is not listed, contact a licensed agent of your choosing and have the agent call the number on the page. 

Agents will be required to provide their real estate credentials before they can show you the property.

WORK WITH BROKERS AND AGENTS

Real estate brokers and agents are welcome to participate with Auction.com. 

Commissions are offered on some properties. 

ou can search the site to find properties that offer commissions or check the property details page. 

Even if a commission isn’t offered, some agents will work with you in anticipation of earning a commission later when you sell or rent the home. 

If you would like to use an agent, follow these steps:

1.Register to bid on the properties that interest you 

2. Add your agent’s information

Make sure your agent registers separately for those same properties

Inform agents that they do not have bidding privileges

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