Valuable Auction Information from Dodie's Auction

Dodie

Col. Dodie Allen

NCAL 3410

10% Buyer's Premium

on all

purchases

AUCTIONS vs CONVENTIONAL PROPERTY SALES

Conventional Property Sales

1. Property is promoted on an ongoing basis.

2. You deal with buyers one at a time and on their schedules.

3. You wait for the right buyer to come along.

4. Priced too high, the property won't sell.

5. Priced too low, you'll lose money.

Auction Sales

1. Auction companies employ high-impact marketing... usually a year's

worth in a few weeks.

2. A well advertised auction will bring a large number of prospective buyers

together at the same place and time.

3. You set the day and time you want your property to be sold.

4. Often the competition created through an auction will fetch a higher

sales price than could be achieved in any other way.

IMPORTANT THINGS TO REMEMBER

1. Auctions do not work miracles.

2. A property owner cannot expect great success with a property that's

been on the market for a long time.

3. Auctions don't increase a property's value.

4. An auction helps to identify buyers who value the property at the

highest amount in the current market.

INITIAL PROCEDURES

I. Type of Auction

There are three general types of public auctions:

A. ABSOLUTE AUCTION - Property is sold without minimum bids or

reserves. Once a property goes on the block, it is sold to the

highest bidder.

Usually this type of auction produces the highest prices because it

attracts the most prospective buyers, which in turn creates more

spirited bidding, which often results in a higher price!

B. MINIMUM BID AUCTION - Seller agrees to sell at the highest bid

above a stated minimum price.

This type works well if the stated minimum bid is low enough to get a

prospect's attention and gets them to investigate the property.

C. RESERVE AUCTION - Seller reserves the right to reject the highest bid.

Although this auction offers sellers the most protection, it is the least

successful.

II. Marketing Plan

Each auction requires a different AUCTION MARKETING PLAN to get the word out that your property is going to be available. This is accomplished through a variety of means, including:

A. BROCHURES - A brochure will be printed which will include photographs

of the property, legal description, maps showing location of and directions

to the property and any other information that would be of interest to a prospective buyer. Naturally, it will also contain the date, time and location

of the auction.

The brochure will be mailed to our established list of local, statewide and

regional markets. When dealing with "special use" properties, or properties

of special importance to a certain profession, we purchase mailing lists from

private companies.

B. NEWSPAPER ADVERTISING - We also make extensive use of the news-

paper, as a means of contacting the widest range and number of prospects.

Local, area and regional newspapers will display ads, and classified ads, on the particulars of your auction.

C. SIGNS - Signs, when and where appropriate, will be prepared and utilized to

inform the local public of the upcoming auction. On the day of the auction,

and scheduled "Open Houses", directional signs will be put out as needed.

The expenses are paid for by the seller and usually run approximately 2% to 3% of the appraised value of the property. All funds spent will be itemized and confirmed with receipts.

III. Date of the Auction

It usually requires 40 to 60 days to schedule an auction. This allows time for the marketing effort to be successful.

Again, this is an area which is carefully planned to attract the greatest number of potential buyers.

An Auction Flow Chart will be provided to give you a general idea as to how the marketing plan will unfold.

We also provide you with a calendar overview that details the auction marketing plan week by week.

IV. Location of and Site preparation for the Auction

It has been our experience that conducting an auction on premises is the most effective. It is cost effective and also will bring higher prices. Once again, this is an area that is carefully studied by our team prior to making any decision.

If the auction has many different properties, spread over a large geographic area, it may lend itself to a central location in an auditorium or similar facility.

Properties, sold by us, are sold on an "AS IS" basis, with no contingencies in the contract. We will make every effort to insure that all pertinent information about the property is presented before the start of the bidding. This includes:

1. A prior "termite inspection" by a licensed exterminator.

2. An examination of deeds, deeds-of-trust, property restrictions and rights-of-ways,

and any pertinent zoning regulations. Anything questionable will be submitted to an attorney for further review. Title search and title insurance are the responsibility of the buyer.

3. All inspections of the property are to be made, by prospective buyers prior to the

auction, at designated times.

4. Most auction sales are not contingent on financing. However, we will make an

effort to inform prospective buyers as to financing availability, loan assumptions, etc.

V. The Day of the Auction

The day of the auction begins with the arrival of our team to put out directional signs, rope off parking areas, set up chairs and refreshment tables, and all other things necessary for the auction.

All the advertising about the auction will announce a period before the auction when prospective buyers may preview the property, talk with our team members about deed descriptions, property history, financing, etc. During this time bidders will register and be given a numbered card to be used for identification when bidding and when the winning bid is received.

At the pre-established time, usually 11:00 AM, the auctioneer will announce the order of the sale as well as its terms and conditions.

ANNOUNCEMENTS, AS TO TERMS AND CONDITIONS OF THE SALE, MADE THE DAY OF THE AUCTION, TAKE PRECEDENCE OVER ANY AND ALL PREVIOUS STATEMENTS, PUBLISHED OR VERBAL.

Audio and video recordings are made of the announcements and the auction.

Bidding continues until there are no more bids and the auctioneer announces the property sold. Then the highest bidder gets an acknowledgement receipt, which includes the bidder's number, identification of the property, and sales price. The high bidder then completes the purchase agreement, and then we follow the contract through to the closing, usually 30 days after the auction date.

The high bidder will be required to make a non-refundable deposit of 10% of the sales price. The deposit will be in cash, cashier's check or money order.

FOLLOW-UP PROCEDURES

All contracts will be closely monitored by our staff.

1. All deposit funds are entered into a non-interest bearing escrow account by First

Choice Real Estate at Macon Bank in Sylva, NC.

2. A transaction file is established which will contain all pertinent information on the sale

and established tracking system to insure that all activity since the auction is progressing smoothly towards the closing.

3. During the follow-up period, contact is maintained with the buyer and/or their attorney,

as well as their lending institution, so as to make certain that all loan applications, employment verifications, or bank deposit verifications are being processed in a timely manner.

4. The seller will be contacted on a regular basis with updates of all activity.

5. Closings are generally held in an attorney's office where the deed is signed transferring

the property to the buyer. An attorney will usually have drawn up the financing papers for the lender and will see to it that the legal papers are correctly prepared, signed and recorded.

6. A "Settlement Sheet" will be prepared, reporting all funds received and disbursed,

commissions paid and other pertinent information.

If you have questions or need further details,

please call

Col. D. A. Dodie Blaschik

(NCAL 3410)

(828) 586-3634-Shoppe

(828) 269-3634-Cell

Web Site last Updated: May 4, 2008.