Phone bidding on homes has become more popular, both because of the hot residential housing market and the changing protocol around COVID-19. But it can seem overwhelming to bid on your dream house over the phone. Luckily, we've gathered some of the best tips for phone bidding at an auction that will help you secure the house you've been eyeing.
Before the day of the auction, there are some things that you can do to make sure that you are prepared. Make sure that you come with a home loan preapproval. Pre-qualifying for a loan will help you know how much you can bid with, set a limit for yourself and understand your budget.
Be aware that when you bid at an auction, even over the phone, the sale is final. Because of this, it is best to know everything about the home before the auction. For example, you'll want to be sure that the house has passed the right inspections. Before going into the auction via phone, be 100% sure that you want the real estate.
Every state has its own phone auction bidding rules and system that must be followed. Know what the rules are in your area. The real estate agent must display the regulations in such a way that makes them clear and easy to access. Your real estate agent will be able to explain the regulations to you and keep you compliant.
A buyer's agent is someone who represents the person who is actually doing the bidding. This should be someone who you trust to listen to your wants and is an excellent communicator. This is the person that you will be speaking with on the phone in most cases, so they are a crucial part of the phone auction. You can interview potential agents, and pick the one that you feel is right for the job of helping you secure your future home.
When the actual auction comes, be prepared for stiff competition. While you may be excited to get your bid out there, it is actually better to wait until you can tell where the house is settling. The asking price is often not the actual price that the property will sell for. By bidding strategically, you and your agent can determine roughly how much the home will be worth in the auction.
In the heat of the moment, it could be tempting to go over your predetermined budget. However, you need to set a spending limit and adhere to it. Your real estate agent and your loan officer can help you determine the ideal amount. When the auction comes around, make sure that you communicate your budget to your buyer's agent.