If you’ve never been to an L.A. County foreclosure auction, it’s a sobering experience. The auctioneer, who would identify himself only by his first name (could be a flashpoint to anyone bent on revenge), first reads off a ton of addresses and why those properties’ auctions were either postponed (mutual agreement was often the reason) or canceled (bankruptcy was a common cause). That leaves about 20 properties on the docket for the day’s auction. The scenario is repeated five days a week both in Pomona and at the county courthouse in Norwalk.
The auction has a start time of 10:00 or 10:30 a.m. but it’s more like 10:50/11:10 before the action begins due to the cancellations. The regulars bring collapsible canvas chairs and carry cashier’s checks to make their purchases. Some read books during the wait or make phone calls as the day doesn’t usually end until about 4 pm.
In the pecking order of the auction, the front row is usually reserved for registered bidders and the order of the auction is determined by the auctioneer.
In less than a minute, ownership of a property can revert back to the lender. Successful bidders must have cashier’s checks ready in the amount they are willing to pay for the property. Most seasoned veterans bring a cashier’s check for the minimum bid and cashier’s checks in smaller amounts up to the amount they are willing to pay for the properties they want.
You must have cash to purchase the property and you are buying it without the right to rescind. A buyer can really get burned if they do not know what they are doing and understand the neighborhood they are buying in. However, companies and individuals that specialize in these types of purchases can make out like a thief and turn a 50% profit in as little as three months. Quite a bit of homework must be done by the purchaser. Don’t think this is your typical auction…
*Sources: Los Angeles Business Journal and Dan Gura