Understanding auction terms & conditions: what you need to know

Participating in an auction, whether you’re buying or selling heavy equipment, requires a clear understanding of the terms and conditions set by the auction house. These terms govern the rules of engagement, outlining the rights and responsibilities of both buyers and sellers throughout the auction process. Let’s explore the essential auction terms and conditions that participants need to know to navigate construction auctions near me successfully!

Buyer’s premium

The buyer’s premium is an additional fee charged to the winning bidder on top of the final hammer price. It is typically calculated as a percentage of the winning bid and is used to cover administrative costs and auction expenses. Buyers should be aware of the buyer’s premium rate set by the auction house, as it will impact the total cost of their purchase.

Reserve price

The reserve price is the minimum price that the seller is willing to accept for an item at auction. If the bidding does not reach the reserve price, the item may not be sold and the seller retains ownership. Buyers should be aware of whether a reserve price has been set for an item they are interested in and bid accordingly.

Bid increments

Bid increments are predetermined increases in the bidding amount required for each successive bid. Auction houses set bid increments to maintain orderly bidding and prevent excessively small bid increments. Understanding bid increments is crucial for buyers to gauge the appropriate bid amounts and participate effectively in the auction process.

Auctioneer’s discretion

The auctioneer has the authority to make decisions and enforce rules during the auction, including determining the winning bid, resolving disputes and deciding whether to reopen bidding. Buyers and sellers should be aware that the auctioneer’s decisions are final and binding, and they must abide by them throughout the auction.

Payment and settlement

Auction terms typically outline the payment methods accepted by the auction house and the timeframe for settlement. Buyers are usually required to make payment in full within a specified period after the auction concludes. Failure to adhere to the payment terms may result in penalties or forfeiture of the winning bid.

Find Lyon Auction’s construction auctions near me

Understanding auction terms and conditions is essential for navigating the auction process effectively. By familiarizing themselves with key terms such as buyer’s premium, reserve price, bid increments, auctioneer’s discretion and payment and settlement terms, participants can participate confidently and achieve their auction objectives. We hope to see you at some of our upcoming construction auctions near me! Contact us today with any questions.

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