When we resort to finance auctions the goal is to make a good deal. So, Finance auctions allow you to buy cars, houses and other goods at a price lower than that practiced on the market.Still, it may not be a simple process. Not all will be good opportunities, so you should “distrust” when the value is too low. That is, if something of great value is on sale for very little, there may be a problem. Be aware.
What are Finance Auctions anyway?
In reality, the Finance auctions are the sale of pledged assets. This happens when a taxpayer does not pay the taxes due and does not have the means to pay off his debt to the State. Consequently, the Tax authorities analyze the assets on behalf of the debtor and pledge it to sell for the amount owed.Therefore, depending on the amounts owed, the taxpayer may lose all or only some assets. For example, he may lose a house, the contents of a store, a motorcycle, among other possessions he may have. In other words, you run out of goods until you make up the amount you owe.Note, pledged goods are put up for auction at 70% of the taxed asset value. If after 15 days they are not sold, the value drops to 50%. If, again, it is not sold, the best offer wins.
Finance Auctions: why the price is so low?
First of all, if any good is sold below the market price, it immediately means that someone loses out in the business. This is because, if the tax authorities charge a low price, it is due to the fact that they only want to recover the amount owed. That is, even if the pledged asset has a higher market value, it has no interest in selling it for a higher value. a much higher value than the debt. When that happens, the debtor or debtor receives the amount of the difference. However, as bidders know that the tax authorities’ objective is to sell only to receive the amount still owed, these usually offer the base valuethat is, the amount that the Tax Authorities need to recover the amount still to be received. Even so, the history tells us that the good must be sold at the highest bidder. In this sense, goods that are in high demand tend to be more expensive and, therefore, reach values more in line with market values.
How to apply?
To participate in the finance auctions, you must enter the official sales page for pawned goods. Here you can see several ads by:district;municipality;or by type of property.In this last option, you can also find advertisements taking into account:Shares in companies;Furniture;Property;Automobiles;Commercial establishments;Among others.
How to bid?
To qualify to buy a pawned asset, you must three modes or ways to do it:electronic auctionIn the case of the electronic auction, the offers are public and made online.closed letterIn this option, each bidder makes his offer in a closed letter and all offers are open on the same day. In the end, the highest bidder wins.private negotiationIn this case, the negotiation is carried out with the appointed person responsible for managing the sales process, that is, the faithful depositary of the good.in each offer consists:the respective type of bidding; and also the date of opening of the proposals in cases where the bidding is by closed letter.
How to access Finance auctions?
To enter an auction, you must first complete your Login with the data you usually use on the finance portal. Then click on the button that is on the right side of the ad (enter the auction) and start making your offers.
Types of pledged assets
Not all assets can be pledged by the Tax Authorities. According to Section III of Decree-Law No. 41/2013, there are some exceptions, namely the essential goods for a domestic economy. They are: the stove; fridge; tables; chairs; among other items belonging to the household stuff. goods indispensable to the exercise of the debtor’s professional activity when dealing with a natural person. On the contrary, all other assets can be pledged. The most common are: houses; apartments; land; stores; cars; motorcycles; bicycles; technological products; other industrial equipment; etc.
9 precautions to be taken in Finance auctions
In this process, there are precautions you should take to avoid unpleasant surprises. Always think twice before making a decision. We leave some tips so that your search is a success and without mishaps.
Legal framework of the asset being auctioned
First of all, remember that the goods you are bidding on have already belonged to someone and are currently pledged. In this way, as in all pledges, the goods can still be recovered.That is, if the goods you want to buy are still in the middle of unfinished court cases, should be even more careful. This is because you run the risk of buying a property and, after a few months, having to leave it because the pledge has been challenged and the property is no longer yours.
Features of the good you want to buy
As already mentioned, in these auctions the tax authorities only want to recover the amount owed by the taxpayer. In this way, you cannot expect a great deal of attention from the latter regarding the quality of the good. In other words, the goods on auction are sold as is. and they may sometimes not be quite what you saw in the ad. In this sense, it is advisable that before bidding take a look at the goods. For example, pay attention if the ad includes the visiting or consultation hours – if not, contact Finance and confirm that the property is exactly what you want. Pay attention if there is any defect!
Possible additional costs
Consider all costs. For example, if you are interested in a car, then it is better to have some additional costs:transport by trailer; car insurance (the car will not be insured); vehicle registration; finally, probably a new battery.
Bid only when you are 100% sure
Before buying a good at auction, ask all your questions. In finance auctions, it is almost impossible to void a transaction. So, you must check all the details of the good you want before bidding so you don’t make any mistake (Finance does not accept regrets).
Pay attention to what you write in finance auctions
To err is human, and we often misspell a number. Then, always check what you write before making the offer. The argument is the same as in the previous point: it is practically impossible to cancel a bid! Currently, with mobile phones and computers, it is common to accidentally reverse numbers and thus exchange, for example, a 0 with a 9. If this happens , will almost certainly win the auction and thus have to pay this amount to the Finance Department.
Know what you are buying and who owns it
It is very important to understand what you are buying. not infrequently, in auctions for plots of land and real estate, the bidder thinks he is buying an entire property and may only be acquiring a portion.Here’s the tip: when a deal seems too good to you, be calculated and analyze all the pros and cons, especially in the case of a property.
Bid only on what you need and you can buy
Following on from the previous points, participate only in finance auctions for which you have an interest and availability. In other words, don’t put yourself into commitments that you can’t pay or even don’t need. Focus only on the properties that you have previously visited or collected information. Remember, It is very difficult to cancel a purchase.
One auction at a time
never participate in multiple auctions at the same time. If you do, it is true that you can earn more than one, but if your intention is only to acquire one good, you must wait for an auction to end before participating in another.
Always have the money you bid
It should be remembered that the State’s interest is to have back the money that the defendants owe it, so there is no possibility of “paying”. So if you happen to win a finance auction, prepare to pay a third of the amount immediately and the rest in the following fifteen days.But there are exceptions. That is, in the case of sales above 50 thousand euroshe can request a request to extend the payment period. Even so, the maximum period goes only until 180 days.If you bid for a good and then don’t have the money to pay immediately, you can count on a punishment: prevented from participating in Finance auctions for two years.Also read: Buying a foreclosed house: a business opportunity for you?