Glossary

A.

• Alerts

  After you create a free account, you can choose to receive custom alerts and real-time email notifications when a property is cleared for sale or the auction is postponed or cancelled.

• Auction Bidder Card

  The numbered card that bidders use to submit a bid at a live foreclosure auction.

• Agent Commissions

  This is the amount paid to a real estate broker and/or agent when a home is sold.

• Auction.com

  The nation’s leading auction marketplace for residential bank-owned and foreclosure sale properties.

• Auction.com Account

  This is your free personal account. Once you create an account, you’ll receive a dashboard where all of your saved properties, searches and messages will reside.

• Auction Calendar

  The calendar lists upcoming auction dates, venues and other important information for live foreclosure auctions. Some live events span the course of several days so make sure to review each day’s properties for the ones you intend to bid on.

• Auction Marketing Agreement (AMA)

  The signed agreement between the seller of a property and Auction.com.

B.

• Bank-Owned

  These properties are owned by a lending institution and typically are sold through bank-owned auctions.

• Bank-Owned Income Producing

  These properties are owned by a lending institution and are rentals with paying tenants in place.

• Bank-Owned & Newly-Foreclosed

  Newly foreclosed properties are those that are posted for sale just days after they are classified as foreclosed.

• Bank-Owned Occupied

  These properties are owned by a lending institution and may be occupied by the former owner or tenants. The new owner takes on the responsibility of managing the occupancy state once purchased.

• Bank-Owned Vacant

  These properties are owned by a lending institution and do not house tenants or owner-occupants.

• Beneficiary

  A beneficiary in real estate is typically the lender. When the legal ownership of property is transferred, it takes place with a deed of trust. The title is transferred to a trustee, which holds it as security for a loan between the borrower and lender. The borrower is referred to as the trustor, while the lender is referred to as the beneficiary.

• Bid

  To offer an amount in an attempt to buy something, while competing with others at an auction. At Auction.com, bidding can be done online or at a live foreclosure auction. The bidder who meets the seller’s minimum price and is the highest bidder typically wins the auction.

• Bidder Deposit

  A bid deposit of $2,500 is required to bid on bank-owned properties at Auction.com. The deposit is a hold placed on a credit or debit card. Unlike a charge, a hold authorizes Auction.com to confirm that your account is valid and that you have a significant amount of credit. Auction.com will instruct your credit or debit card issuer to remove the hold following the auction. The hold is removed regardless of the outcome of the auction.

• Bid Increment

  The bid increment is the amount that the bid increases during the auction. For example, if the current bid is $50,000 and the bid increment is $5,000, the next acceptable bid amount would be $55,000.

• Bid Pending Confirmation

  If you see “Bid Pending Confirmation” BEFORE the property was set to be auctioned, it was sold as a “Pre-Auction” bid. If you see “Bid Pending Confirmation” AFTER the property was auctioned, it means it was sold in the auction.

• Broker

  Any person who acts as an agent, bringing two parties together for any type of transaction and earns a fee for his or her service. At Auction.com, broker partnerships are encouraged.

• Buyer’s Premium

  Some properties sold in bank-owned online auctions require a “Buyer’s Premium.” The premium is usually 5% of the winning bid or $2,500 whichever is greater. This fee is only required if you are the winning bidder.

C.

• Cancelled Property

  A foreclosure sale can be cancelled for several reasons. Some of the more common ones include:

  • When a homeowner and lender reach an agreement so the homeowner can keep the property.
  • When a homeowner files for bankruptcy protection, this results in an automatic stay being placed on the property. The bankruptcy doesn’t stop the foreclosure, but delays it until the homeowner resolves the debt or the lender gets approval from the bankruptcy court to proceed with the sale.
  • The beneficiary (lender) can decide to cancel the sale for any reason. The lender may not be ready to sell the property; may sell it elsewhere or may get paid off by the homeowner.

  Unfortunately, Auction.com is not privy to the reasons behind a cancellation.

• Cashier’s Check

  A cashier’s check is a check guaranteed by a bank, drawn on the bank’s own funds and signed by a cashier. Cashier’s checks are treated as guaranteed funds because the bank, rather than the purchaser, is responsible for paying the amount.

• Certificate of Sale

  In many states, you will receive a Certificate of Sale at the live foreclosure auction after you pay for the property. Check you state’s procedures for details.

• Cleared for Auction

  When a foreclosure property is “cleared for auction,” it means the sale is scheduled to go as planned. Many foreclosure sales get cancelled or postponed so we recommend checking the status of the property before going to the live auction.

• Closing

  If you win a property auction, the closing process includes the final steps in your transaction. The closing process may take anywhere from 30 to 60 days and the closing date will be set by the contract. Once complete, the property ownership is transferred from the seller to the buyer.

• Credit Bid

  A credit bid is a bid placed by the beneficiary – also know as the lender. By law, the beneficiary is allowed to place this bid during the auction either directly, through an auctioneer or by Auction.com. These bids are typically the total amount due to the beneficiary, including the trustee fees and expenses.

• Credit and Debit Card Hold

  When a hold is placed on a credit or debit card, a certain portion of the credit limit or debit balance is held for a short period of time. We require a $2,500 bid deposit to bid on bank-owned properties. The deposit, however, is really a hold placed on your credit or debit card, which is released following the auction.

• COA

  Condominium Owner’s Association

• Counter Bidding

  Counter bidding is a common practice used by all major auction houses. Auction.com will counter bid on behalf of the seller in order to move the price closer to the Reserve Price or Credit Bid, which is the minimum that a seller will typically accept. Once the bidding reaches that threshold, Auction.com will no longer counter bid.

D.

• Dashboard

  Once you create a free account, you’ll have access to your own personalized dashboard where you can receive emails, create lists of saved properties and receive email alerts for a specific property or properties in certain locations. You can also manage your bids from your dashboard.

• Deed

  A legal instrument that confirms the transfer of a property’s title.

• Disclosing the Reserve Price

  The Reserve Price is the lowest price that the seller is willing to accept. It’s up to the seller to disclose the Reserve Price. When the Reserve Price is disclosed, you can find it on the property details page.

• Distressed Residential Real Estate

  These are homes that are either in a pre-foreclosure state or have undergone the foreclosure process and are now bank-owned properties. They also may become short-sales, in which the lender agrees to sell the home for less than what is owed on it.

• Disclosure Documents

  Important property and legal documents that should be reviewed by interested bidders prior to the auction. Disclosure documents can be found on the property details page.

• DocuSign® Transaction Room

  When you win an online auction and sign the purchase agreement, you will be invited to join a DocuSign Transaction Room. This “room” is a shared folder where you can upload and track all of your contracting documents in one place.

• Due Diligence

  Conducting due diligence involves thoroughly investigating a property before you bid on it. It includes researching the estimated value, estimating repair costs, reviewing title reports, inspecting the property (if possible) and researching the surrounding neighborhood.

• Due Diligence on an Occupied Property

  Many of our properties are occupied by former owners or tenants so be sure to check the property details page to learn as much as you can. If a property is occupied, you can still do your due diligence with the exception of seeing the inside of it. You can drive by the outside to take photos and observe the neighborhood. You can also research the schools and crime rate. But please do not disturb the occupants or trespass on the property.

E.

• Earnest Money Deposit

  A deposit placed by the bidder to let the seller know that the bidder is earnest or serious about buying the property.

• Escrow

  When the lender releases the home purchase funds around the same time that the deed is recorded to reflect the new ownership. Escrow opens when the buyer and seller sign a sales contract, commonly called a real estate purchase agreement.

• Estimated Debt

  This is the total estimated debt, plus court-imposed fees, unpaid interest and legal costs owed by the homeowner at the notice of foreclosure sale.

• Estimated Value

  The estimated value is calculated using local comparable sales and current listings.

F.

• Final Judgment Amount

  This is the final amount due when you buy a home at a foreclosure sale. It typically includes the remaining amount owed on the mortgage; accrued interest; attorney fees and advertising fees. There’s also the possibility that you may have to pay liens, taxes and other costs. That’s why it’s imperative to do a thorough due diligence investigation before you bid on a property.

• Financing

  Financing is the act of providing funds or capital to a person or business with the expectation that the money will be paid back. Financing is available on some of the properties listed on Auction.com. Check the property details page to see if financing is available on the properties you’re considering purchasing.

• Foreclosure Sales

  These properties are generally sold at live auctions. A foreclosure sale occurs when a lender attempts to sell a property to recover the balance of a loan.

• Full Warranty Deed

  A deed in which the seller guarantees that he or she holds clear title to a piece of real estate and has a right to sell it to the buyer.

G.

• Gaining Possession of a property

  When you purchase a property at a foreclosure sale, you typically can’t gain possession until you have a clear title, the deed is transferred into your name and the home is vacant. If the property is occupied, you may want to contact a real estate attorney for assistance.

H.

• Homedisclosure.com Report

  This report summarizes neighborhood schools, crime and environmental factors affecting the property. When available, the report can be found on the property details page.

• HOA

  Homeowners’ Association

• HUD

  U.S. Department of Housing and Urban Development.

• HUD-1 Settlement Statement

  This is a standard form which is used to itemize services and fees charged to the borrower by the lender or broker when applying for a loan for the purpose of purchasing or refinancing real estate.

I.

• Interior Access Available

  You can search for properties that allow interior access so you can see the inside of the home before you bid on it. Start by typing in the location where you would like to buy. Click on “All Asset Types” and go to “Bank Owned & Newly Foreclosed.” Then, in the box on the right, click on “Access Available” and you will see all of the homes that will allow you inside.

J.

K.

L.

• Land

  Property or real estate, not including buildings or equipment.

• Landlord

  Any person(s) that rents or leases property to an occupant.

• Lease

  A lease is a contractual agreement between a tenant and landlord that spells out the terms of tenancy. This includes length of time for occupancy, monthly rent to be paid, responsibilities and rules. At Auction.com, you can bid on tenant-occupied rental properties that already have a lease in place.

• Lender’s Max Bid

  This is the maximum amount that a creditor will bid for select properties. Buyers have to bid above this amount to purchase a property.

• Limited Liability Company

  A limited liability company (LLC) is a corporate structure whereby the members of the company cannot be held personally liable for the company’s debts or liabilities.

• Log-in

  When you sign into your account.

• Log_out

  When you sign out of your account.

M.

• Manufactured Home

  A manufactured home in the United States is typically a home built in a factory that complies with HUD code standards. These standards were developed in 1976 so manufactured homes in the U.S. have been built after that year. Manufactured homes can be placed on private land or in a community with other manufactured homes and mobile homes.

• Mobile Home

  A mobile home in the United States is typically a home built in a factory prior to 1976 before the HUD code was established. Mobile homes can be placed on private land or in a community with other mobile and manufactured homes.

• Mortgage

  A mortgage is a legal agreement that allows an individual to borrow money from a lender to buy property. Once the mortgage is paid off, the agreement becomes void.

N.

• Newly-Foreclose

  These are properties on Auction.com that recently became available for auction, usually days after the property became bank-owned.

O.

• Online Bidding

  This is where a buyer participates in an online auction by placing bids.

• Opening Bid

  This is the estimated dollar amount that starts the auction.

• Outbid Period

  This is a term specific to properties won in foreclosure sales in North Carolina. The Outbid Period is a 10-day period in which someone can place a higher bid than the previous bid, usually 5% or $750 higher, whichever is greater. Each time a new high bid is placed through the county clerk, the 10 days start over. This process continues until no new bids are placed and the 10 days runs out.

P.

• Postponed property

  A foreclosure sale can be postponed for several reasons. Some of the more common ones include:

  • When a homeowner files for bankruptcy protection, this results in an automatic stay being placed on the property. The bankruptcy doesn’t stop the foreclosure, but delays it until the homeowner resolves the debt or the lender gets approval from the bankruptcy court to proceed with the sale.
  • The beneficiary (lender) can postpone the sale for any reason. It could be simply that the lender is not ready to sell the property.

  Unfortunately, Auction.com is not privy to the reasons behind a postponement.

• Pre-Auction Bid in Online Bidding

  With a pre-auction bid, you can submit your offer online prior to the competitive bidding of the auction. Pre-auction bids must meet the minimum bid amount, but should reflect your highest and best offer. The bid will be reviewed by the seller to determine if he or she would like to proceed with your offer. If so, the property will be removed from the online auction and you will be able to proceed to the closing process.

• Profile

  Your profile is established when you create your account. It contains your name, physical address, phone numbers, email address and password.

• Proof of Funds (POF)

  A document that demonstrates that a bidder has the funds available to purchase a property. All bidders will need a Bidder Qualification Form and be prepared to provide a recent (within the last 60 days) bank or brokerage account statement.

• Property Details Page

  This the page on Auction.com where you can start your due diligence. It contains photos of the property; square footage; characteristics of the home; property reports and how to register for an auction or information on a live event. To get to the property details page, type in the location where you would like to buy property, then when you see the homes in your preferred location, click on a photo and you will be taken to the property details page.

• Property Inspection Report

  This report provides additional information about the property, neighborhood and may offer comparable sales. But it’s not an appraisal and its accuracy cannot be guaranteed.

• Property Status

  This information tells you if the property was cleared for sale or if the auction has been postponed or canceled. The property status can be found on the Property Details Page directly above the address.

• Proxy Bid

  Available in select online auctions, the bidder can set a specific bid amount and Auction.com will automatically bid up to that amount.

• PUD

  A planned unit development (PUD) is a residential community governed by a homeowner’s association. PUDs can consist of single-family homes, condos and commercial property, such as stores and restaurants. If you purchase a property within a PUD, you’ll most likely have to pay HOA dues to cover amenities such as a pool, playground or park. The dues can also be used to pay for security, landscaping and street lights.

Q.

• Quitclaim Deed

  A quitclaim deed conveys the seller’s rights and interests in a property to the buyer. It does not, however, provide any warranties or covenants to the buyer. Many properties on Auction.com have a special warranty deed option which allows the buyer to purchase title insurance and receive a special warranty deed instead of a quitclaim deed.

R.

• Real Estate Agent

  An individual who sells and rents buildings for a client. Real estate agents are welcome to help their clients buy property with Auction.com.

• Receipt of Sale

  A Receipt of Sale, also known as a Certificate of Sale, is typically given to buyers at a live foreclosure auction after the buyer pays for the property. But this practice varies from state to state. Check you state’s procedures for details.

• Redemption Period

  A redemption period is a specific period of time during which foreclosed homeowners can buy back or “redeem” their property. If you purchase a property in a redemption state, you will not be able to evict the homeowner or tenant during the redemption period. Check your state’s guidelines to see if it offers a redemption period.

• Rent

  The amount of money a tenant pays a landlord to occupy a property, typically paid each month.

• Rentals

  A property that is rented out each month by a tenant. You can bid on tenant-occupied rental properties that already have a lease in place at Auction.com.

• Reserve Price

  The reserve price is the lowest price that the seller is willing to accept. The reserve price is set when the listing is created. This minimum price must be met by the buyers in order for the property to sell.

• Residential Property

  Any non-commercial property such as single-family homes, condominiums, townhouses, fourplexes, triplexes, duplexes and manufactured homes.

• Residential Notes

  A real estate loan that is secured by a residential property. There are two types: Performing (the owner is paying their mortgage) and Non-Performing (the owner has stopped paying their mortgage).

S.

• Short Sales

  When a homeowner owes more on their mortgage than the home is worth, the lender may agree to accept less than the amount owed. A short sale gives the owners a chance to walk away from their mortgage and the bank a chance to alleviate the expensive and time-consuming process of foreclosure.

• Security Deposit

  An amount of money held by a landlord during the term of a lease to cover non-payment or any potential future damages to the property.

• Seller

  The beneficiary or owner of a property who transfers ownership to the buyer in return for a payment.

• Separate Entity

  When real estate is purchased under a separate entity rather than as an individual. Types of entities include partnerships, limited liability companies (LLC) and corporations. Auction.com requires the entity to provide legal documentation as part of bidding process.

• Separate Entity Documents

  These are the legal documents required when property is purchased by a separate entity on Auction.com.

• SFR

  SFR is an acronym for Single Family Residence.

• Starting Bid

  The beginning price for an available property to be bid on at an auction.

• “Subject to Acceptance”

  When a property is sold “subject to,” it means the property is being sold “subject to” the seller’s approval.

• “Subject to Seller’s Confirmation”

  When a property is sold “subject to the seller’s confirmation,” the sellers don’t accept the bid right away so the sale is subject to their confirmation, meaning they have a set period of time to either accept or reject the offer.

T.

• Tenant

  Any person(s) legally allowed to occupy a rental property as part of a lease or rental contract.

• Tenant-Occupied

  A property that is leased or rented by tenants.

• Title Report

  A full title report shows exactly what is on the title and indicates if there are any liens for items like unpaid taxes or homeowner association dues.

• Total Purchase Price

  The final amount of money due from the winning bidder. This amount is comprised of the winning bid amount plus a Buyer’s Premium (if applicable).

U.

• Upset Bid

  This term refers to properties won in foreclosure sales in North Carolina. The upset bid is a bid that is placed within 10 days after the end of the auction. Each subsequent bid must be 5% or $750 higher than the previous bid. Each time a new high bid is placed through the county clerk, the 10 days start over. This process continues until no new bids are placed and the 10 days runs out.

V.

• Value-Based Bidding

  A value-based bid means that the beneficiary of the property, typically the lender, has provided or is expected to submit a bid based on the current market value and below the total estimated debt.

• Venue

  This is the site of the live foreclosure auction. On Auction.com, most live auctions are held at county courthouses or hotels.

• VIP Buyer

  A VIP Buyer is an investor who buys multiple properties per year at Auction.com. As a VIP Buyer, you are entitled to many privileges, such as having the bid deposit waived and receiving priority service when you win an auction. Learn more about the VIP program.

W.

• Warranty Deed

  This is a deed that guarantees a clear title to the buyer of the property.

X.

Y.

Z.

• Zoning laws

  The basic purpose of zoning is to divide a municipality or county into residential, commercial and industrial districts (or zones) that are – for the most part – separate from each other.