Submitted by Charles Koppa
The auctioneer represents the “beneficiary” in the sale.. If there is a “reserve amount minimum” (see below) the auctioneer actually bids up as agent for the unnamed beneficiary! The recipient “beneficial trust” is finally publically identified and documented by the Foreclosing Trustee in the recorded Trustees Deed Upon Sale. Try to find a human officer for that trust!
Beneficiary makes no personal bid, delivers no cash, and is allowed a credit bid! PROBLEM: a beneficiary (if known) would be a “party in interest” and could not be a bonafide buyer. An est. 80% of the Courthouse sales go “Back to Beneficiary” (publicly unknown) and therefore are unlawful. Lack of Notice and availability of Due Process to meet your accuser are historically common.
Predatory devaluations, plus untitled transfer of foreclosed mortgage notes systematically confiscated by “investment trusts” that were structured by Bank Holding Companies with no skin in the game, plus processing by shadow intermediaries “against the borrower”, equals “Tyranny on the Courthouse Steps!”
Sellers have the option of setting a hidden Reserve Price that is above the minimum starting bid. If a reserve price is in effect, then the seller does not have sell the item unless the high bid meets or exceeds his reserve. Auctions with a reserve price will be noted in their listing, describing whether the reserve has been met or not. The actual amount of the reserve price is not revealed to bidders, until it has been met.
When you submit a bid on a reserve price auction, one of three things might happen:
(1) If the reserve has already been met, then your bid will be submitted at one increment above the next highest competitor, in the same manner as an auction without a reserve price.
(2) If the reserve has not been met, and your maximum bid is also less than the reserve, then your bid will be entered at one increment above the next highest competitor.
(3) If the reserve has not been met, but your maximum bid is enough to meet the reserve, then your bid will be entered at exactly the seller’s reserve price. If your maximum was above the seller’s reserve, then your proxy will defend your bid, up to your maximum.If you are the highest bidder at auction close but the reserve was not met, then neither you nor the seller are obligated to the transaction. However, you may wish to negotiate further via email, to see if a mutually satisfactory price can be reached.EXAMPLES:
No sale:
Item #9999 had a minimum starting bid of $100.00
The seller set a reserve price in his listing of $200.00.
At the end of the auction, the highest bid is $175.00.
In this case, the seller is not obligated to sell for $175.00, but may choose to do so anyway.Sale:
Item #8888 had a minimum starting bid of $900.00.
The seller set a reserve price in his listing of $1,200.00.
At the end of the auction, the highest bid is $1,225.00.
In this case, the seller is obligated to sell for $1,225.00 to the highest bidder.