I want to give a big Shout Out to Terry Howe!
Last Friday, I sat down with Terry Howe, an auctioneer that I have used in the past. I wanted to ask Terry a few questions that I had been asked over the years and put this together in an article that my customers could read and understand why sometimes an auction is better than listing with a real estate agent.
Gwen: What does an auctioneer do?
Terry: I have been in the auction business for over 30 years. The definition of what I do has changed over time.
- I act as an intermediary between family members, attorneys, banks and judges.
- I inventory and appraise personal property and real estate. I develop evidence to make equitable divisions of assets.
- I identify problems and then come up with solutions that all parties can agree to work through.
- Secure properties, find property that has been removed and identify what can be sold.
- Fix problems; find solutions to issues that would keep a property from selling.
Gwen: What is the advantage of using an auctioneer?
Terry: If a property has issues, legal or family, or problems that would make them hard to market and sell or if the seller is to the point that CASH is more important than the asset, I am the person to call. My sellers get cash in hand in 60-75 days. I can arrange the sale to coincide with life events, like moving to another home. I also sell unusual, unique properties that have no comps.
Gwen: What is the disadvantage of using an auction to sell property?
Terry: The general perception is that you only have auctions for estates or if the seller is broke. Not all sellers are distressed, some don’t have to sell, just want to sell. An auction accomplishes their goal. An auctioneer has to determine what the goal and motivation is. Where do you want to go or be when the auction is over? No goal, no auction. Auction equals a closed transaction in a short time with no surprises.
Gwen: How do you eliminate surprises?
Terry: When you sign to do an auction, the first thing I do is to have a title search done by my attorney. They will make sure there are no issues. When you do a real estate sale through an agent, this will not come up till you have an offer on the property…making closing slower and sometimes it can make the deal fall apart.
Gwen: How long after the auction do we get paid?
Terry: We plan for a 30 day or less to close. We have already done the title work, there is usually no bank involved, so all we have to do is send the signed contract over to my attorney. An update will be done and we can close as soon as 3 days or as long as 30. Cash and go.
Gwen: Please walk my customers through the auction process.
Terry: The sale usually starts with a phone call to my office. The receptionist will ask a few questions, standard questions, like owner, address and phone number, good time to call back, etc.
- She will put together a package of information gleaned from the courthouse/tax office and other public records. She will include a tax map, zoning and topo maps and if necessary a flood map.
- I will then return the call. If the seller is agreeable and we have a general agreement then I will set up a time to meet.
- I will explain agency: we are a single agency brokerage. We only represent sellers.
- We will discuss the equity in the property, market and go through whether or not this is a property for an auction. I do not take every auction I am offered.
- I will explain the terms of the auction, most of which are in favor of the seller.
- We will discuss the advantages for selling “as is”.
- Then we will go through the contract package, I will explain our marketing process, auction/bidding process and how the property is closed.
- If we all agree, we will sign the contract—listing—and I will go to work.
- Most of our auctions are absolute without an opening bid. Many of our buyers are not local.
- Once we get a final bid we will send the contract to the buyer and then to the seller.
- When we get it back it will be sent to the attorney to close. Neither buyers nor sellers have to attend the closing, packages can be sent FEDEX…we have to have a wet signature. Digital signatures are not acceptable on property transfers in SC.
- When the funds and the deeds to transfer the property are back then the money will be dispersed to the correct parties.
Gwen: What is your favorite thing about doing your job?
Terry: I get to meet lots of people, learn a lot. I have learned over time that problems are opportunities—things to be fixed.
Consulting with sellers about the benefits of using the auction method of sale to achieve their goals. Promoting auctions to lenders, attorneys, and other business professionals. Advising potential clients about the suitability of their property for the auction method. Terry Howe & Associates