Manufactured home auctions can be a great way to get a mobile home below market value. However, mobile homes though low winning bids, don’t always equate to great deals. This has to do with when they most often go to auction, which is often a public foreclosure auction. In this article I will discuss where to find mobile home auctions and the pros and cons of bidding on them. I will also share my experience with the mobile home auctions near me.
Mobile Home Auctions Near Me – Find and Bid on Manufactured Homes
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What is a Mobile Home Auction?
A mobile home auction is an event in which manufactured houses are sold via bidding. There are typically two kinds of auctions in which these housing units are sold: traditional home auction or public foreclosure auction.
In either event there is an opportunity to get a mobile home below the market value. When a mobile home is auctioned via a tradional home auction, potential buyers can inspect the home and place their bids. In a public foreclosure auction of a mobile unit, you may not be able to inspect it of even look inside the unit at all.
In each style, these are conducted via English Auction rules. When you place a bid you are entering into a legally binding agreement to pay if you win.
How Do the Home Auctions Near Me Work?
Mobile Housing auctions typically are structed like this:
- There is a preview period where you can achedule to visit and inspect the home. In the case of a foreclosure auction there is no preview period.
- A few week registration period. This is where you register with the auction company in order to participate in the event. You will need to prove who you are and your ability to pay.
- At a live public auction an auctioneer facilitates the event. In an online auction people bid for a pecified time period.
- The winner is determined by the highest bid at the end of the time limit or when there is no competing bid.
- Each bid placed incrementally raises the bid price, until a winner is reached.
- The registered bidder with the highest bid wins as long as the owners reserve price is met.
Special Rules For Manufactured Home Auctions
In my experience with mobile home auctions, you often encounter the following…
- The property is sold “AS-IS” with no contingencies (so long as the title is immediatly insurable)
- Traditional financing is accepted, but there is no motgase contingency required.
- A Buyers Premium (BP) Applies: 10% of the highest bid or $4,000 whichever is more will be tacked onto to the final hammer price to make the actual selling price. For example if you win on a $50k bidm your final price is actually $55k.
- There will be a minimum non-refunable deposit due immediatley. It is often around $4k. Then you have 60 days to close and pay the remainder of finance.
- Typically a bank will have the buyer set up an electronic wire transfer for the deposit amount when they register.
This is how the mobile home auctions near me work.
Benefits and Risks of a Mobile Home Public Foreclosure Auction
If you are bidding on a manufactured home via a public foreclsure auction, there are both benefits and risks.
It is absolutley possible to win a foreclosed mobile home well below market value. That is the biggest benefit!
The risks though can really outweight the rewards if you are an inexperienced buyer. These homes are sold listed “as-is”. There is a potential that you are on the hook for outstanding leins, unpaid tax bills, and issues around the title. There is also a possibility you have to evict the current residents.
These homes are typically in pretty bad shape and require repairs before it is livable. To decide if it worth bidding on you must add the purchase price plus the cost of repairs. If that adds up below the home value, you may have found a great mobile home unit to bid on.
Offestting the Risks
What many folks do instead of bidding on a foreclosed mobile unt, they wait it out till after auction. This happens when no bids (or no qualifying bids) are received on the unit. Then the bank takes ownership and the property becomes Real Estate Owned (REO). When this happens a bank may do some renovations and clean the palce up, but this isn’t always the case.
Finding Mobile Home Auctions Near Me
There are a bunch of ways to find mobile home auctions near me. Alot of these events are still marketed via tradional channels like classified ads, newspapers, and flyers. Many are now advertising them online.
Some mobile home events are government auctions. You can find these listed on sites like USA.gov or you can check your local Chamber of Commerce.
The Smarter Way to Find Mobile Home Auctions Near Me
My trick to finding uatcions is to use Google Events. You can mostly find mobile unit auctions in more rural areas. The ones you find on Google Events are often fairly localized, which means less people attend. That equates to less competition to bid against. Click here for Google Events – Mobile Home Auctions.
Whos Homes are These Anyway?
That depends on who is running the auction. If a real estate company or auction house is holding the event then it is more likely a private owner. In a public foreclosure the auction is held by the bank, because the owner defaulted on their lein.
Home auctions feature houses that a owner wants to sell. They have decided not to use a real estate agent. That decision is often based on if they think it’s more convenient, need to sell a property by a certain date, or the right buyer may pay more for it.
Are There Fees to Buying or Selling at a Home Auction?
Yes. there are typically fees associated with winning a mobile home via auction. These fees can include:
- Buyer Broker Commisions: This is a a percentage of the winning high bid amount (often around 3%) paid to any agent who’s buyer successfully closes on the property.
- A Buyers Premium (BP): Often 10% of the highest bid or $4,000 whichever is more will be tacked onto to the final hammer price.
- Minimum Non-refundable deposit due at signing
Commisions and fees vary from event to event so be sure to read all the fine print.
Do You Just Show Up and Bid on Units?
No. to bid on mobile homes at auction, you must be a registered bidder. This requires sign up before the event. You will have to prove your identity, residence, and ability to pay.
Mobile Home Auctions Near Me Conclusion
If you are interested in bidding on manufactured housing you must know the risks. While you can walk away with a sweet deal, sometimes these units are in bad shape or have outstanding administrative issues like taxes and leins. If you plan on bidding at these events you need to know the rules and really read as much as you can about the properties. This is what I have learned from the mobile home auctions near me.