glossary

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.

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.

BID DEPOSIT

Auction.com may require two types of bid deposits:

• For select properties, a deposit may be required during the registration period. This deposit shows you are committed to proceed to closing if you are the auction’s winning bidder. You will be required to submit the deposit funds to finalize your property registration and activate your bidding privileges. It is essential to note that this process may take 1 to 2 business days, so plan accordingly to ensure adequate clearance time before the auction commences.
• For specific customers, a bid deposit may be necessary to reactivate their account after they have failed to comply with the bidding terms and conditions. In this scenario, the required deposit amount may increase in correlation with the number of violations of these terms and conditions.

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’s scheduled auction time, it was sold as a “Make an Offer Now” property. If you see “Bid Pending Confirmation” AFTER the property’s auction time, the property 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.

Bundle And Save Event

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.

CANCELLATION FEE

A $2,500 cancellation fee may be charged when the winning buyer does not fulfill their post-auction obligations, as per the Participation Terms. This improves the auction experience by encouraging all participants to place serious bids.

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.

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.

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.

Direct Offer

A feature which allows you to make offers and counter offers directly to sellers on select Bank-Owned properties outside of an auction.

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.

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.

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.

ENTITY

A separate entity is a structure in which the law allows a group of people to act as if they were a single person for certain purposes. Entities are most commonly used for property ownership, lawsuits and contracts.

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 CREDIT BID (ECB)

The credit bid is the minimum amount bidders must exceed to win the property. Also known as the “Upset Bid,” lenders can bid up to that amount at a foreclosure sale. If bidding at the sale doesn’t reach the Credit Bid, the property is not sold and the lender takes ownership.

EST. RESALE VALUE (ERV)

The Est. Resale Value (ERV) is derived from an automated value provided by a third-party. It’s based on comparable sales of similar properties that are very well maintained and with no deferred maintenance. The Est. Resale Value (ERV) is critical because it helps investors calculate the difference between the “as-is” value, or price they pay for a property and the resale value, the price they can potentially get when they sell the property. It gives investors an estimate of their profit margin after all necessary repairs are made.

EVENT

An auction event is a time slot when a group of similar homes are auctioned. To find out if properties are in the same event, compare the Event ID number from the Property Details Page to the Event ID on other properties and see if they are the same. Note: Only the first six digits need to match, the remaining digits are the Item number.

FCL Predict

These foreclosure properties are most likely to go to sale on their scheduled auction date. 

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 a property means that you could purchase a property if approved for a mortgage loan that you would pay back in payment installments. Check the property details page to see if financing is available on the property that you are considering purchasing. 

First Auction for All

These REO properties are scheduled for a first auction in which all customers can participate. 

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.

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.

GENERAL PARTNERSHIP

A general partnership is an arrangement consisting of two or more people who agree to share in all assets, profits and financial and legal liabilities of a business. Members must sign a Partnership Agreement.

HOA

Homeowners’ Association

Hot Bank Owned

These bank owned properties are likely to be well-priced and sell quickly.

Hot Foreclosure

These foreclosure properties are likely to go to sale and likely to be well-priced.

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.

INCORPORATION (INC)

The process of establishing a company, city or other organization as a legal corporation, which is an entity that is separate and apart from its owners.

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.

INVESTMENT PROPERTY

A real estate property purchased with the intention of earning a return on the investment either through rental income, the future resale of the property, or both.

IRA

An individual retirement account (IRA) is a type of an individual retirement plan that provides tax advantages for retirement savings. There are several different types of IRAs, with each having its own tax implications and eligibility requirements.

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.

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.

LIMITED PARTNERSHIP

A limited partnership (LP) consists of two or more partners who operate the company jointly, and each partner’s liability may be limited to each partner’s level of investment.

LOG-IN

When you sign into your account.

LOG-OUT

When you sign out of your account.

MAKE AN OFFER NOW

With Make an Offer Now, you can submit your offer for select properties online. These offers must meet the minimum bid amount, but should also reflect your highest and best offer. If the offer is accepted, the property will sell proceed to sell.

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.

MATCH THE BID

Properties that feature a “Match the Bid” icon are properties where the winning bidder is given 6 hours to complete their Contract Information Form to move forward with the closing process. During that time other interested bidders will be given the opportunity to MATCH THE WINNING BID and get in line to purchase the property should the transaction fail to be completed.

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.

NEWLY-FORECLOSE

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

NOW VACANT

These REO properties recently became vacant and were previously labeled as occupied.

ONE BID AWAY

Displayed on the bidding window when the highest bid is one bid away from reserve, this message alerts bidders that the next bid placed will meet reserve.

One Dollar Opening Bid

These REO properties have one dollar starting bids and typically low reserves. 

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.

PENSION PLAN

A pension plan is a type of retirement plan in which an employee adds money into a fund that is matched (or contributed to) by an employer, based on employee income and length of employment.

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.

PRICE DROP

The reserve on these REO properties has recently been reduced. 

PRIMARY RESIDENCE

The home which is considered to be the main living location where the majority of the time is spent by an individual.

PROFILE

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

PURCHASE PROFILE

A Purchase Profile gives buyers the ability to save the information they provide during the online contracting process for bank-owned properties. This information lets Auction.com know how the buyer intends to vest the property. Saved profiles can be used for future purchases so the information doesn’t have to be provided again. Buyers can also access their Purchase Profiles in their dashboard.

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 is 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 INFORMATION 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.

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 before the auction starts, which will be automatically placed during the auction.

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.

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.

QR CODE

A QR code (quick response code) is a type of barcode that is used to provide easy access to information through a smartphone. Our app’s new QR Code feature was developed to help our customers expedite check-in at registration. Simply pre-register on the app and use the QR Code that is generated to check in at our in-person auctions.

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.

REMOTE BID

Remote Bid is a feature within the Auction.com mobile app that allows investors to place bids on select foreclosure properties. Investors can submit their bids in advance and wait until the end of the auction to see if they won. Or, they can bid in real-time from their phone where live remote bid is available.

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.

REO

Real Estate Owned (REO) refers to properties that have reverted to the lender’s ownership after a foreclosure auction or deed-in-lieu of foreclosure.

REO Overtime

When the highest bid is near reserve but not accepted by the seller, the auction is extended for one day, giving bidders more time to increase their bid amount.

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).

SALES DEPOSIT

The Sale Deposit is an amount set by statute required by law to be paid by the winning bidder. When purchasing Ohio Foreclosures online with Auction.com, all sale deposits must be wired by the winning bidder to the title company indicated by the PSO and Auction.com within 2 hours following the end of the sale.

SECOND HOME

A residence that you intend to occupy for part of the year in addition to your primary residence. 

SHORT SALE

A sale when a borrower may be behind on their mortgage payments or owe more than the property is worth. Lender approval may be required.

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.

Seller Watching Live

These REO properties are in an auction where sellers review bids in real time at auction end. 

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 SELLER ACCEPTANCE”

All bank-owned properties bought at auction are “Subject to Seller Acceptance.” Please know that whether the buyer meets the Reserve Price, that doesn’t guarantee that their bid will be accepted by the seller. Once the purchase agreement is signed by the buyer and the seller then the bid has been accepted.

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.

Top REO Deals

These hand-selected REO properties have certain qualities or features that deem them potential top-tier deals.

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).

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.

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.

WARRANTY DEED

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

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.