The first thing an auction buyer will do is arrange a meeting with a Liberty Capital preferred loan specialist. The loan specialist will walk the buyer through all the financing steps needed to successfully win a bid at auction. The buyer will then get prequalified, similar to the loan prequalification process when making an offer on a property in a conventional purchase setting. The pre-qualification process involves producing documentation of income and/or a verification of funds. (See Auction Loan Guidelines)

Once a buyer has moved through the pre-qualification process, the loan specialist will provide the buyer with a maximum loan amount and a minimum down payment amount. Liberty Capital may finance up to 90% of the purchase price of an auction property to a qualified buyer.

Every auction buyer will be paired with a real estate agent. Liberty Capital has a preferred networkof real estate agents that are experienced in working with foreclosures that we would be happy to recommend but we welcome buyers to work with an agent of choice. Once this relationship has been established, both parties will receive access to the Liberty Capital foreclosure property tracking website.

The agent will conduct a drive-by external property evaluation, provide an estimated fair market valuation of the property, and provide other important information pertaining to the purchase of the property. The website allows the user to search properties, enter and save search criteria that will automatically email the buyer when a property matching the criteria enters the database and “cart”, or save, desired properties. The user will receive automatic email updates on all properties placed in the user’s cart. These updates are sent as reminders 48 hours before the property is scheduled to go to auction, when a minimum bid is posted or when the property has been postponed to a future date to be auctioned off.

Every property page and property email update will contain a link to a Liberty Capital Auction Loan Request form. If the buyer is interested in obtaining an auction loan for a specific property, the on-line Auction Loan Request form would need to be completed. This form electronically notifies the Liberty Capital auction lending team of the buyer’s interest in the specific property and provides the team with the necessary information needed to prepare a bidding strategy for the purchase of that specific property. (See Auction Loan Request Form)

The buyer will need to bring the necessary down payment funds to the Friday auction in the form of multiple cashier’s checks; personal checks are not accepted. The cashier’s checks can be made out to the name of the buyer, to be signed over to the property Trustee when the buyer wins the bid on a specific property. Because the actual amount of the winning bid is not known beforehand, it is recommended that the buyer bring different denominations of checks to auction. It is necessary to bring a legal form of identification (e.g. driver’s license, government issued ID card, Passport) to the auction when bringing cashier’s checks in the name of the bidding buyer.

Example:
An auction buyer has been pre-qualified with Liberty Capital for a loan not to exceed $250,000 and a 15% minimum down payment.

The opening bid is $150,000 and the buyer is willing to bid up to $200,000. The buyer should come to the auction with multiple cashier’s checks in the amount of $30,000 (15% of $200,000). The buyer would need to go to the bank beforehand and obtain multiple cashier’s checks totaling the maximum down payment amount (e.g. one check for $20,000 and two checks for $5,000). Liberty Capital would be at the auction with the additional funds needed to purchase the property.

Washington state properties are sold at 10:00 AM each Friday morning. A representative from a specific Trustee will read off the property list by first announcing the current seller’s last name. The last name of the seller is referred to as the “Grantor”, which is a commonly used term at auction. The name of the Grantor is used more frequently to reference the property than the common address of the property.

The auction crier will read the name of the Grantor as well as the sale disclosures and the legal description of the property. Once done with the initial reading, the crier will ask for any and all bidders of that property to step forward. The auction crier will register all interested bidding parties and verify each bidder has sufficient funds to purchase the property. A bidder can only bid up to the amount that is verified with the crier. A Liberty Capital representative will help any buyer or agent with the auction process of verifying funds. Additionally, Liberty Capital will bring sufficient funds to the auction, also in the form of cashier’s checks, to assist in the purchase of the property.

When the buyer is the winning bidder on a property, the buyer will fill out the purchase paperwork along with the help of the Liberty Capital representative and the Trustee representative. The paperwork is typically a one page hand written bill of sale. The bill of sale contains the winning bid amount, vesting instructions and the total amount in cashier’s checks paid for the property.

In most cases, the Trustee will receive more funds than the purchase price of the property. This is because the cashier’s checks brought to auction were fixed amounts. The Trustee will send an exact overpayment refund to Liberty Capital’s office.

Example:
An auction buyer contributes $40,000.00 (down-payment and loan closing costs) and Liberty Capital
contributes $160,000.00 for a total of $200,000.00 in cashier’s checks payable to the Trustee. The
winning bid purchase price is $196,000.000. The Trustee will send Liberty Capital an exact refund in the
amount of $4,000.00 within one to two weeks from the date of auction purchase.

When completing the purchase documents at auction, the buyer and Liberty Capital will vest on Title as joint owners of the property. The Trustee’s Deed, the document that is sent by the Trustee to verify the new owner(s) identified at auction, will be sent to Liberty Capital’s office. Liberty Capital will execute a Quit Claim Deed removing its ownership from Title. The Trustee’s Deed, Quit Claim Deed and Deed of Trust will be sent to the County’s office for recording.

Once the Trustee bill of sale has been finalized at the auction, the Liberty Capital representative will notify its office lending team of the final purchase price and property address. The representative will deliver the exact down payment amount and vesting instructions to the lending team. The lending team will draft the loan documents and have them ready for the borrower to sign as early as 1pm that same day. The borrower will visit the Liberty Capital office that same day to confirm specific details of the transaction and execute the loan documents. The loan documents will move the property out of a joint purchase into a scenario where the borrower is the sole owner. Liberty Capital becomes the lender with a senior deed of trust recorded on the property.