In NC once a property is sold at a foreclosure auction, there is a10-day hold put in the purchase in which anyone can make another bid on the property that is at least 5% higher than the final sales price at the auction. If another party bids on the property, it is called an Upset Bid. The party that makes the upset bid must give a certified check for 5% of the purchase price and must close on the property usually within 30 days.
Once an upset bid is submitted, another 10-day hold in effect for another party to make an Upset Bid. There is no limit to how many times this can happen.
Here is an real example for a piece of real estate in Winston-Salem: at the Courthouse auction a property sells for 70,000 so a 5%, or 3500.00 immediate payment must be made. A person can make an upset bid for only 73,500 which is 5% higher than the auction sales price (or upset bid price). A second bidder did bid 73,500 and had to pay 3675.00. The first bidder, not to be outdone, bid 81033.00 and this bid was won the upset bid and another earnest money deposit had to be paid in the amount of 4051.00. Of course, if a bid loses to another upset bid, the earnest money is returned to the bidder. In this example, the second bidder (or the party who made the first upset bid) really wanted this property and bid 85085.00. The other interested party decided enough is enough and did not make another upset bid. The property sold for 85085.00 and the buyer had to pay an earnest money deposit of $4254.00 and had to close with property with the rest of the sales price within 30 days.
Posted on July 21, 2014 at 5:36 pm by J.C. Grose