- What is a Proxy Bid &how does it work?
- What is a Bank Letter of Gaurentee and when do Ineed it?
- What are the auction Terms?
- What is the Multi-Parcel Auction Method?
If you want to bid at an auction but can't attend, Preferred Properties will bid on your behalf if you make a proxy bid. A proxy bid is also known as a "left bid." You decide on what parcels you want and how much you would be willing to pay for each of them or in combination.
Fill out the proxy bid form (stating the parcel, description and highest bid you are willing to make, along with name, address, phone, etc. as indicated) and mail or fax it to us so that we receive it by noon on the day before the auction. You will also need to include a $10,000 Bank Treasurer's Check for a deposit and proof of funds.
The clerk from Preferred Properties will bid on your behalf at the auction. We will bid only up to the amount you've indicated on your proxy bid form.
Bidding at Preferred Properties auctions happens in increments stated by the auctioneer (starting fairly low and working its way up) so you may win a parcel for less than the full price you stated on your proxy bid form.
The need for a bank letter of guarantee will be stated in the auction terms.
Bank letters need to be on bank letterhead and signed by a bank officer. The following format should be used:
* * * * * * * * * *
Bank Letter of Guarantee
______________________(bank name) guarantees payment to Preferred Properties or their seller from _____________________(customer name) on account number _____________(your account #), up to the amount of ____________($ amount). This guarantee is valid for purchases at the _____________________________(auction name/auction date).
___________________________(name of bank officer)
* * * * * * * * * *
The bidder must pre-register before auction and display to Auctioneer proof of deposit to obtain bidder number. At the sale, the person holding the public auction shall sell to the highest aggregate bidder or bidders whether as two individual parcels or in total, please see multi-parcel method description below. The purchaser at the sale shall pay or show satisfactory proof of cash or bank letter of guarantee, or produce a commitment letter from a bank or mortgage company or other lender licensed to do business in the State of Vermont, to the person holding the sale. A deposit shall be paid at the time of sale of at least $10,000.00 in the form of cash or bank treasurers check. Purchaser is required to sign a Purchase & Sale Agreement at the time of the auction with a close date no greater than 30 day from auction.
Here is a brief description of the Multi-Parcel Auction Method. The first individual track will be auctioned to a point that the bidding has stopped advancing. Bids will be recorded with the amount & the bidder numbers. We will then proceed with the same process with the second track. We will then combine the bids from the two individual tracks and begin the bidding plus a bid increment for the combination track. The combination will be auctioned to a point that the bidding has stopped advancing and the amount & bidder numbers recorded.
We will then ask if there are any requests for the individual tracts again. If there is, we will add the amount that the combination advanced to what the original bid on that tract was and increase it by the bid increment amount. If bidding begins, then both tracts come out of the combination and are reinstated as individual tracts. The individual tracts will then be auctioned to the point bidding stops advancing. We will then ask if there are any requests for the combination . . . . . and so on until there are no more bids. At this point the Auctioneer declares Last call! Any more requests for any individual tract or the combination? If NO, then the Auctioneer will check the reserve levels and if met will declare each tract or the combination or whatever the winning positions are at that point SOLD!
It is important that as a bidder you stay engaged to the end. Using this method can lead to an individual track coming out of a combination during the second or third round and actually starting at a price level that was less than the previous round.