If this is the third round of auctions that tells me that at least in this area the house is over valued or that there are major problems with it that are not visible in the pictures.

The problem may be something like location that is not obvious from the listing or from maps that has prevented the sale so far that the buyers of auctioned houses know. Things like new developments or major road expansion etc.

Auctions are difficult in many cases.

They are listed in the MLS with a listing agent and office. It isn't unusual to have auctions when the property is an REO type property. It is much more common when they are REO's as opposed to "pre-foreclosures". I only know my area of S Florida so it may be different in your area.

The listing does contain the auction information, but generally not all of the added fees IME. For example, it is increasingly common to have a mandatory 'technology fee' added to the purchase price paid by the buyer as well as the customary buyer's premium (generally in the neighborhood of 5%). There are other fees too.

I have seen auction properties go under contract and then fail to close due to a seller's issue, like not being able to deliver clear title because the seller didn't own the property at the time of sale or closing! I explain to my buyers about the differences so they can be aware that it is a totally different process than any normal closing so they can prepare themselves mentally and financially. With an auction, you never know if it is going to close until it is actually closed. The seller can pull out at any time. The buyer? No, not without penalties.

<?xml version="1.0" encoding="UTF-8"?><md>We did tour the house with our agent. We live in a rural area in upstate NY, very small population.

My question is, will the bank eventually tire of the auction nonsense and just list it as a regular sale or keep trying for additional rounds...

The listing Agent wasn’t able to answer that question other than ‘keep watching ‘

The listing agent wouldn't know what the bank is going to do. IME the asset manager for the bank controls the method of sale (auction, standard REO type listing or something else like a bulk sale).

I haven't seen an asset manager change the method of listing from an auction type to a regular REO type listing - ever. Not that it hasn't happened, but that I haven't seen it and I've been in the real estate business for 40 years. I have seen the reverse: where the listing starts off as a REO listing and then after a period of time where it isn't sold it then goes to an auction type listing.

Find out from the agent who owns the property. Some banks/lenders are more prone to auctions than others. For example: OCWEN usually sells via auction and they have their own real estate company. I don't know how they run their business now, their reputation got so bad that they now have acquired another lender (PHH) and now use their name rather than their own. That is just one example.

I’m wondering why they would prefer auction after auction with no success as opposed to buyers ready to make an offer through a traditional sale.

Sorry for the dumb questions but I’m not familiar with the process.

Agree with sushipup1. That's when I discovered that the asset managers control the REO properties and will willy nilly turn down excellent cash offers for their own reasons. Those reasons were not disclosed to the agents (listing or selling) nor the buyers. Most of us assumed some sort of cronyism at work at the time but didn't have proof. Maybe a former bank insider can provide a better explanation.

Can't see what the problem with buying at auction is. Offer what you're willing to pay and either you'll get it at a price you're happy with or it will sell (or not sell) for more money than you think it's worth. In either case you win.

Of course you need to factor in the terms and conditions and any unusual fees. Consulting with a RE lawyer to look over the paperwork prior to bidding would probably be wise.

Unless you are a professional investor and completely familiar with the process, I would respectfully suggest changing your dream.

These are extremely difficult to acquire. I know it makes no sense, but the process is opaque at best. Things that seem to be commonsense, such as a buyer ready willing and able to purchase with funds in hand, isn't good enough. Finding the decision maker is necessary and impossible.

Most real estate agents will steer you away. And, with good reason. These are time, money and dream suckers.

Don't waste your time or effort any further. It's an insiders game. None of us are insiders.

I'm curious doesn't an agent have to present all offers no matter the form to a seller? Nevermind it is listed as an auction. Can't a normal offer be prepared and given to the listing agent and would they then be required to present it to the seller, or are there exceptions to this?

It really is a shame. Our agent STRONGLY advised us not to play the auction game. To be clear, this is an online auction through an auction website, which after some research, got horrible reviews.
It is not a county-run foreclosure auction...

I guess the search continues:(

lyfia, yes the agent has to present all offers.

However, the asset manager/auction company decide the method on which they will consider any offer. Any other method is automatically rejected. There are extensive instructions in the listing broker notes and document attachments as to how and when offers will be reviewed. If you are working with a normal seller, you have a variety of ways to submit offers. Not so much with online auctions. They have their very own methods with no leeway.

paintedpeggies, I am not surprised at your research results. I'm glad you took the time to research the reality of those types of auction sales. As you point out, it is not like the county-run foreclosure auctions at all.

Thanks Denita for the explanation.

"Maybe a former bank insider can provide a better explanation."

Former bank insider here!

Do you know what type of bank owns the property? A national bank with little to no local knowledge will likely operate in a different manner than a more local/regional bank.

This is what I found:
The lender, DEUTSCHE BANK NATIONAL TRUST COMPANY, assumed this property during foreclosure proceedings and now owns it.

Doesn’t sound warm and fuzzy...

On a separate note, I found another one that’s listed as a pre-foreclosure. It went to county auction but was not purchased there. It is owned by a local neighborhood bank. I tried to get information from the bank but haven’t received a callback yet.

Would you happen to know if there’s a way to purchase what’s considered a pre-foreclosure before it’s listed? I tried researching it but I am getting conflicting answers. I also contacted a “foreclosure specialist “and was told it could take four years before it’s actually listed.

This seems a bit extreme considering it’s already been to auction...

Honestly, banks are not rational, they are not using best business practices, they do not use the most capable people, they change their own rules seemingly at a whim.

Got it?

Deutsche Bank is huge. If this sale is being handled by an outside (hired) asset management company, none of this surprises me.

"On a separate note, I found another one that’s listed as a pre-foreclosure. It went to county auction but was not purchased there. It is owned by a local neighborhood bank. "

by county auction, do you mean sheriff sale? In my banking experience, we never had anyone buy on of our sheriff sale properties. When one buys a property at sheriff sale, you are responsible for clearing all liens, back taxes, mortgages, etc. Real estate at sheriff sale is nearly always worth less than the cost to get a clean title.

Unless you have a lot of time to waste (like, months and months of no action/no movement at all!) , and gobs of literally unknown amounts of money to throw around, I would advise staying away from foreclosures, pre-foreclosures, or anything that smells like one.

:)

While tv shows makes it sound like you can receive a huge profit after purchasing a property at auction then fixing it up and selling while it may happen as stated above the amount of money needed to sell with a clear title can be very expensive. Start looking for houses that are not this type unless you like to gamble and are willing to loose a lot of time and money.

We just want a place to live. Not making a profit by flipping.
We’re in a very small rural area with limited inventory.

OP, in any market there are sellers that are anxious to sell. They don't advertise it (naturally), but they exist in any market. An example: estate sales that need work typically sell at the lower end of the market. Some can be purchased at very low prices because the heirs don't want to continue to carry the costs to hold it and they would rather have cash now, rather than running up their costs.

There are other sellers that have hit a financial road bump and are willing to sell to save their credit or move onto something else that is time sensitive. Your agent can find those sellers. It takes more work, but it is possible.

Foreclosures are hit or miss. Pennfire is right about Deutsche Bank being huge. And they are involved with their very own troubles with many multiple scandals over the past few years. I would make it a point to stay away from them entirely. JMO.

And also right about the sheriff's sales and having to clear the title after purchase at your expense. Sometimes after you buy something through an auction you have to go through a Quiet Title action which can take many months. And the most important point, you don't necessarily get a better deal with an auction especially when you are having to clear the title after the purchase.