Buying a home at a California auction may be an effective way to get a good deal on a principal residence or rental property. However, it is important to have a plan in place before you start bidding to ensure that you don’t overpay for a home or buy a house that doesn’t meet your needs.
You might not get to see the house before you bid
As a general rule, you don’t get to perform a formal inspection on a home listed at an auction before you make an offer to purchase it. Sometimes, you can look at or walk through the home before the bidding begins. However, a simple glance at or a quick trip inside of a property won’t always give you a sense of its true condition.
There’s no guarantee that you’ll take ownership of the property
In some cases, the lender will need to approve your bid before you can take ownership of the home. Furthermore, the home’s current owner will likely be given a chance to pay back taxes and regain possession of the property after the auction concludes. If anyone currently lives in the home, it will be your job to evict those residents after taking ownership of it.
You assume all liabilities associated with the home
If there is a mechanic’s lien on the property, you will be responsible for paying for any work done when the previous owner lived in the home. You may also be required to pay back taxes or take other steps to remove existing liens from a property. An attorney may perform a title search before the auction to determine if there may be any issues with taking possession of a home.
When buying a home, it is generally a good idea to do so with the help of a real estate law attorney. A legal professional may perform a title search or represent your interests in court if someone else makes a claim on the property.
