bill j.

I put a fair market offer in on a short sale. This offer was accepted by the seller and I have completed over 2 months of the process with the bank. The bank had already gotten 2 separate BPOs (Broker property value opinion). It appeared that everything was on track and we were just awaiting the bank to accept our offer or counter… dun dun dun… the plot thickens.

Enter the illustrious Auction.com into the equation. The bank which is based out of CA said that they often use online auctions through Auction.com to verify that offers are "fair market". So in essence my certified offer would be used as the reserve price for an EBAY like auction. This is a total BS scenario for several reasons…

1. The house is not in CA! It is in the rural northeast! The market does not support auction based selling! It is done the old fashioned way… you know with a realtor!

2. The owner/seller accepted my offer! As long as that offer is accepted the bank should not be able to entertain any other offers let alone an Effin auction!

3. How is an online auction even to be trusted?

So here is what happened. Auction.com contacted me and told me that I MUST register for the auction but if I bid even $1000 over my current offer that I would have to pay then a 5% commission on the total sale price! Well that eliminated me from the bidding process since 5% would have been a substantial amount. The irony here is that if the bank had negotiated I would have been willing to go up another 10-15k but the 5% commission eliminated that. Auction.com mandated that the seller agent have an open house even though the house was technical "under contract" and not even listed! As expected only a few ppl showed up. The auction started very low and the bid increment was 50k. After the first day it appeared that several bid came in but the bid was nowhere near mine. The next day more bids came in and the bid amount was sitting at 5000 less than my offer. There was only one day left and it looked as if my offer would stand. As the clock ticked down, the bid increment was still at 10k and as the last few seconds ticked, mysteriously a bid of 5k more came in to tie my offer. This reset the clock to 2 min and the bid increment was lowered to 5k and it still said "reserve not met". As the clock ticked down to 1 second another bid came in for 5k putting it above my offer BUT it still said "reserve not met"? The bid increment dropped to 2500 and with one second a bid came and the clock reset, "reserve not met". Bid increment dropped to 1000 and with exactly 1 sec left the clock reset… "reserve not met". The bid increment dropped all the way to $250 and this continued for almost 2 hrs and then the listing just disappeared? By this point I was smelling a rat big time! The next day I called and inquired about the house and posed as a bidder rather than the offer holder. I explained the bidding war at the end and how the listing just disappeared. The rep looked it up and said the reserve had not been met and the house had not sold? So I had the seller agent contact all the people who registered for the open house to see if they bid and guess what… ONLY ONE BID! They bid once and it was a very low ball bid! This means that auction.com was doing the bidding itself in an attempt to get us to bid and pay them a 5% commission! They have total control of the bidding and the "perceived" reserve amount! As a buyer you are not only bidding against other buyers but against the effin site as well! And get this… even if you win the seller can decline your winning offer! The whole thing is, in my opinion ethically and morally WRONG!

Bottom line… auctions like this should be illegal! Proceed with extreme caution! Auction.com is not to be trusted.