REFERRAL ProGRAM

BROKER REFERRAL PROGRAM POLICIES AND AUCTION HIGHLIGHTS

Through the Referral Program, International Realty Auction Network has created alliances with the brokerage community whose member brokers represent more than 100,000 agents throughout the U.S. and abroad.  These member brokers have buyers that they have not been able to satisfy who turn to these properties expecting to make a wise investment.  The ideal property candidate for an auction is a property with a seller committed to selling at a market price determined by the open competition of the auction.  Or, it can be especially useful for properties that have had difficulty rising above the market clutter to attract attention.  The accelerated auction process creates urgency in markets where little exists and spotlights the property, reaching buyers for it beyond the local marketplace and effectively generating offers for the sellers.

REO (bank owned) properties are also appropriate for auctions.  Because the bank has done so much research on their properties by ordering appraisals, inspections and title search reports, these properties are in a much better position to attract a buyer who may not have seen the property before.  The buyer recognizes that it is a great value with documentation to support that value.

Additionally, builders and developers often have inventory that they need to move quickly as the interest on the construction loans continues to build and the market is not yielding the sales that were expected prior to construction.  Incentives often don't work in a slow market and end user loans are difficult to obtain when money becomes tight.  The auction is the answer when a definite time of sale is important in order for the seller to make future plans.

There are many unknowns in the traditional marketplace.  In other words, the process begins after the contract is signed.  In contrast, most of the research is done in the reverse prior to an auction event.  Photos, videos, appraisals, inspections, surveys, title searches, and tax information reports are packaged in advance leaving little chance of a sale not closing.  Buyers know what to expect and must have an approved loan or pay cash at auction.  There are no contingencies to fracture the sale in an auction and very little, if any, negotiations.  The properties are sold as is, where is and that removes a lot of suspense.

The real estate agent may add properties to our system with ease.  Savvy agents will supply as much information about those properties as possible so that the buyer/bidder will choose their listing as a property on which they would like to bid.  A full listing fee will be earned at the close of the sale (which, because sales at auction close in 30 days after a signed agreement is accomplished, hastens the closing considerably). Buyer Brokers often refer their buyers to auctions.  Proper registration is required for any buyer so that we can track the buyer to the agent.  Broker registration prior to the auction is available on our website at www.intlrealtyauction.com. Buyer Brokers need to stay involved with their buyers throughout the process and assist with both the bidding  and closing steps in order to earn a full Buyer's Agent commission at closing.  Additionally, Buyer Brokers must be licensed in the state where the property lies on which their client places a bid.  Online auctions often take the buyer to other locations, so the buyer broker will need to stay in touch with the buyer and advise International Realty Auction Network if the buyer is bidding on property where the buyer broker is not licensed.  A referral fee can be arranged in this event.  If the agent would like to simply refer properties and buyers to our firm, he or she is certainly due a referral fee.  The listings will be assigned to agents in the areas where the property lies.

Criteria for placing properties and prospects in an auction environment are set for the benefit for all concerned:  They are:

1.  At least a 90 day term from time of entry into our system must remain on the exclusive right to sell listing agreement.  There is a lot of work to be done to procure the buyer and a lot of up front money to be spent on the marketing of the property to reach the correct target audience.  After explaining this auction marketing tool to the seller, we know that he will agree that we need the time to get the job done properly.

2.  A 6% listing fee is required from the Seller.  Listing contracts should be modified or amended accordingly if necessary.

3.  After input into the auction system, all buyers must know that there will be a 5% buyers premium charged at closing.  If they "Buy it Now" or "Pre-Bid" prior to the auction, this premium is also appropriately charged.  The auction may be the very reason that the sales contract was procured as the auction created the urgency to move the buyer forward to offering a contract on the property. 

4.  All assigned  properties in our system must remain with the Broker In Charge whose license number is registered at time of input.  All of our arrangements are with that Broker and with the Seller and we must be able to have a point of contact throughout the process.

5.  In addition to the listing contract, a marketing agreement with the licensed Broker and an auction contract with the Seller authorizing us to market the property through an auction will be required.  These documents are available online and may be accessed by member Brokers after registering on our site.  Additionally, there are Broker Registration forms and a sample Purchase and Sales Agreement and Amendments for the bidder to examine pre-auction.

6.  Arrangements with local MLS organizations need to be made so that the listing can remain a part of MLS during the auction period.  Entering the auction date, time and place in the remarks is helpful and, once again, creates urgency. 

7.  Local advertising should continue as scheduled.  It is helpful to keep ads running and to consider small display ads announcing the auction.  All ads should target the auction.  Once again we are creating urgency to the situation.  A small auction sign should be placed in the front yard or on the property announcing the date and time of the auction.