Congratulations for successfully bringing down the hammer at the auction process. Beyond being able to sweep every other bidder off their feet by your method of bidding; you must have put a lot of effort and resources in understanding the procedure. Good for you, the machinery is closer to your reach why other serious buyers standing by keep wondering what they had missed. But then, it does not stop at that. After winning the auction, what should be your next steps?
After auction steps
As the highest bidder, the machinery is not yours yet but you have an exclusive opportunity to negotiate with the auctioneer. Except if you decide to hang the negotiation, the sellers cannot take on another bidder for negotiation. As a buyer who is really interested, you need to be on your look-out. The mistake many make out of ecstasy is ignoring legal advice and jumping in to pay. Clip your emotions. We are not recommending any cooling-off period, but as a buyer, the next steps should be carefully taken.
Request for sales contract
As a buyer, you should not stop asking questions until the contract is completed. Even though you have made your research and read the information provided by the auctioneer, you should still request for the sales contract. Among other things, it should provide you with the description of the property (images if possible), statement of the price, terms and conditions upon which the sale is to be made, and name of the seller/auctioneer/agent.
A legal adviser is necessary for any bidding contract you want to sign. Don’t ever think you don’t need one. We won’t stop emphasizing this because of our auction knowledge base. In fact, a lot of breaches could have been saved if the buyer had involved the expertise of a legal practitioner. For buyers, sellers and auctioneers of used industrial equipment, we provide comprehensive information. Once your legal adviser is involved, he has the duty to carry out legal investigation on the machinery. With his trusted opinion, you can proceed with the contract deposit.
The buyer needs to understand the warranty and the terms and conditions. Warranties also apply to auction sales and according to the provisions of Uniform Commercial Code (UCC). The provisions cover areas such as non-conforming goods, frauds, breach, shipping, transportation of the equipment, loss, damages, conflicting documents, reclamation, among others. However, the first thing is to determine if the provisions of UCC cover the interest of the auction method.
Every bidding process, depending on the legislation of that state or territory, has set policies. As a buyer, you must understand the policies of your state before you register for a bidding and even pay. For example, the Victoria legislation on Consumer Affairs posits that the contract deposit must be left with the meddling agent in an account until the contract is concluded. What happens if there is no meddling agent between the seller and the bidder? Well, both can agree to have the money deposited in a bank under their names. Another option is to leave the deposit in the custody of their legal adviser.
This applies to a buyer who is paying for a property through loan or mortgage. If there is a pre-approval, you need to get a formal permission. This may take some days but it’s all in the buyer’s interest. During the waiting period, the lender measures the value of the property before approval. This helps them to ascertain if you are not paying above the market value. Upon approval, your lender will dispatch a letter of offer and other papers to sign to you. Details that should be contained in the papers include borrowed amount, annual percent interest, method of calculation and manner of contractual changes, credit fees and other charges.
At this stage as well, you need the service of your legal adviser or conveyancer. He is to read before you sign.
Pay and get your receipt
While you may receive a Certificate of Sale at the auction, you should get a receipt after you pay fully for the property. Different terms and conditions apply to an auction process depending on your state’s legislation. You should know what works and take the necessary steps.
Acquire and record the deed
Congratulations for successfully completing the financial process but it does not end there. After the payment, you have to record the data of the deed with the county or the administrative department that governs sales and purchase of property in your state. The Trustee’s deed of sale will be needed to do the recording, so you must get it as soon as possible after the sale. The deed gives you the title of ownership. Meanwhile, recording the deed is not part of the auction process. It is a do-it-yourself part of the auction. The requirements vary across states. Just be aware of the legislation of your state concerning this.
Gain possession legally
The deed only confers the title of ownership and not right to possess the equipment. If it is a foreclosed property, until you have the legal permission, you do not have the legal right to it. In fact, the machinery may still be serving the needs of the owner while it is being auctioned. Of course, the occupants or owner needs to hand-over but you must be careful. Whether it is a physical or online auction process, you must follow through legally. There are laws that protect the interest of immediate occupants/users and this varies across states as well. Know about them as violating any of the laws could attract legal consequences. This is also a part where the assistance of your legal practitioner is needed.
Meanwhile, there are a number of fears about online auction services. Well, we can proudly say that there is no stress involved as long as the parties involved understand the terms and conditions. Our clients such as Euro Auctions, Troostwijk Auctions, among others have been making a difference with the auction process. Do not hesitate to visit their websites and learn more.