Right of second lowest bidder when top bidder does not qualify for the auctioned property?
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Right of second lowest bidder when top bidder does not qualify for the auctioned property?
I participated as buyer (bidder) in a commercial property auctioned by a real-estate auctioning company for a real-estate company. I did not win but was second lowest bidder. About three months after the same auctioneer announced the same property for auction for the same real-estate company. When I asked them why are they re-auctioning the property again? They said that the final bidder did not qualify or attempted to get the mortgage and opted to forfeit the deposit of ~70K. I feel that I have been wronged. They had my name and phone number why did they not contact me as second final bidder. Their answer and announcement for rebidding make me suspicious that they might have used dummy bidder for the auction. Is there any regulation in my favor? Should the auction have contacted or/and given me as a second lowest bidder?
Asked on June 10, 2009 under Real Estate Law, New Jersey
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 14 years ago | Contributor
My research suggests that if the high bidder fails to consummate the transaction that the property is put back out for auction. I saw no statutory provision the mandated that the second highest bidder be given automatic rights to purchase, or that they even be contacted on the matter at all.
However, I am not licensed in New Jersey, possibly there is a provision in state law regarding this situation of which I an unaware. You should consult with an attorney in your area for more information.
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