Glossary of commonly used auction terms.

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Absentee Bid
A procedure which allows a bidder to participate in the bidding process without being physically present. Generally, a bidder submits an offer on an item prior to the auction. Absentee bids are usually handled under an established set of guidelines by the auctioneer or his representative. The particular rules and procedures of absentee bids are unique to each auction company.

Absentee Bidder
A person (or entity) who does not attend the sale but submits, in advance, a written or oral bid that is the top price he or she will pay for a given property.

Absolute Auction
An auction where the property is sold to the highest qualified bidder with no limiting conditions or amount. The seller may not bid personally or through an agent. Also known as an auction without reserve.

Accounting of Sale
A report issued to the seller by the auctioneer detailing the financial aspects of the auction.

Agent
A person who acts for or in the place of another individual or entity by authority from them.

Appraisal
The act or process of estimating value.

"As Is"
Selling the property without warranties as to the condition and/or the fitness of the property for a particular use. Buyers are solely responsible for examining and judging the property for their own protection. Otherwise known as "As Is, Where Is" and "In its Present Condition."

Auction
A method of selling property in a public forum through open and competitive bidding. Also referred to as: public auction, auction sale or sale.

Auction Listing Agreement
A contract executed by the auctioneer and the seller which authorizes the auctioneer to conduct the auction and sets out the terms of the agreement and the rights and responsibilities of each party.

Auction Marketing
The method of marketing personal or real property utilizing the auction method of sale.

Auction Plan
The plan for pre-auction, auction day and post auction activities.

Auction Price
The price of a property obtained through the auction method of marketing.

Auction Subject to Confirmation
(See "Auction with Reserve ")

Auction Value
The price which a particular property brings in open competitive bidding at public auction.

Auction With Reserve
An auction in which the seller or his agent reserves the right to accept or decline any and all bids. A minimum acceptable price may or may not be disclosed and the seller reserves the right to accept or decline any bid within a specified time.

Auction Without Reserve (Absolute Auction)
An auction where the property is sold to the highest qualified bidder with no limiting conditions or amount. The seller may not bid personally or through an agent. Also known as an auction without reserve.

Auctioneer
The person whom the seller engages to direct, conduct, or be responsible for a sale by auction. The person who actually "calls," "cries or "auctions" the property at an auction, recognizing bidders and acknowledging the highest bidder.

Bank Letter of Credit
A letter from a bank certifying that a named person is worthy of a given level of credit. Often requested from prospective bidders or buyers who are not paying with currency at auctions.

Bid
A prospective buyer's indication or offer of a price he or she will pay to purchase property at auction. Bids are usually in standardized increments established by the auctioneer.

Bid Rigging
The unlawful practice whereby two or more people agree not to bid against one another so as to deflate value.

Bidder Number
The number issued to each person who registers at an auction.  

Bidder's Choice or "Choice out"
A method of sale whereby the successful high bidder wins the right to choose a property or properties from a grouping of similar or like-kind properties. After the high bidder's selection, the property is deleted from the group, and the second round of bidding commences, with the high bidder in round two choosing a property, which is then deleted from the group and so on, until all properties are sold.

Box Lot
A group of items typically in a "box" or some container.

Buyer's or Bidder's Fee
An additional percentage added on to your bid amount. Many auction houses and some auctioneers use buyer premiums to share some of the sellers expenses with the buyer.  It is an amount added to the high bid on each item selling and payable by the buyer. This should be listed in the payment terms and advertising for the auction. Example: (A person wins the bid on an item for $5.00 then add the buyers fee @ 5%, add +.25-cents to the bid amount of $5.00, the final sale price at check-out will be $5.25.)

Caveat Emptor
A Latin term meaning "let the buyer beware." A legal maxim stating that the buyer takes the risk regarding quality or condition of the property purchased, unless protected by warranty.

Clerk
The person employed by the principal auctioneer or auction firm to record what is sold and to whom and for what price.

Collusion
The unlawful practice whereby two or more people agree not to bid against one another so as to deflate value or when the auctioneer accepts a fictitious bid on behalf of the seller so as to manipulate or inflate the price of the property.

Commission
The fee charged to the seller by the auctioneer for providing services, usually a percentage of the gross selling price of the property established by contract (the listing agreement) prior to the auction.

Conditions of Sale
The legal terms that govern the conduct of an auction, including acceptable methods of payment, terms, buyer's premiums, possession, reserves and any other limiting factors of an auction. Usually included in published advertisements or announced by the auctioneer prior to the start of the auction.

Contract
An agreement between two or more persons or entities which creates or modifies a legal relationship.

Dual Agency
The representation of opposing principals (buyers and seller) at the same time.

Due Diligence
The process of gathering information about the condition and legal status of assets to be sold.

Estate Sale
The sale of property left by a person at his or her death. An estate auction can involve the sale of personal and/or real property.

Hammer Price
Price established by the last bidder and acknowledged by the auctioneer before dropping the hammer or gavel.

Market Value
The highest price in terms of money which a property will bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus.

Minimum Bid Auction
An auction in which the auctioneer will accept bids at or above a disclosed price.

Minimum Opening Bid
The lowest acceptable amount at which the bidding must commence.

Multi-Seller Auction
Properties owned by many sellers, offered through a common promotional campaign are auctioned in a single event.

No-Sale Fee
A charge paid by the owner of property offered at a reserve auction when the property does not sell.

Opening Bid
The first bid offered by a bidder at an auction.

On-site Auction
An auction conducted on the premises of the property being sold.

Preview
Specified date and time property is available for prospective buyer viewing. Also known as Inspection.

Request
In some cases, the auctioneer will state that we will take a short recess and he will offer the opportunity to "request" items and bring them to a designated table or wagon.  This is done to accommodate the to buyers present before it gets to late in the auction.  Each auctioneer handles request in his own way.

Reserve
The minimum price that a seller is willing to accept for a property to be sold at auction. Also known as the reserve price.

Reserve Auction
An auction in which the seller reserves the right to establish a reserve price, to accept or decline any and all bids or to withdraw the property at any time prior to the announcement of the completion of the sale by the auctioneer. See also Auction With Reserve.

Ring-men or Ring person
Individuals who are positioned throughout the attendees at the auction to assist the auctioneer, display merchandize, spot bidders and assist prospective bidders with information to help them in their buying decision. 

Sale Manager
The person designated by the auction company who is responsible for organizing the details of an auction. Also known as project manager.

Sealed Bid
A method of sale utilized where confidential bids are submitted to be opened at a predetermined place and time. 

Seller
Entity that has legal possession, (ownership) of any interests, benefits or rights inherent to the real or personal property.

Terms and Conditions
The printed rules of the auction and certain aspects of the Purchase & Sale Agreement that are read and/or distributed to potential bidders prior to an auction sale.

Tie Bids
When two or more bidders bid exactly the same amount at the same time and must be resolved by the auctioneer.

You're In
You are the current high bidder.

You're Out 
Someone else has the bid.

Withdrawal
Failure to reach the reserve price or insufficient bidding.

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