The New York Unified Court System has authorized a pilot project in Queens, Monroe, and Niagara Counties that introduces live, remote bidding in foreclosure auctions. This addition will run concurrent to the standard, in-person auction through the use of a third-party platform, however not for all foreclosed properties — this option only exists for ”properties where the foreclosing party has engaged such a remote bidding technology provider to provide foreclosure sale marketing and auction services” (Queens Supreme Court, 2023).
On or after September 8th, when these hybrid auctions become available, the third party must designate a representative to collect, verify, and announce remote bids in real time throughout the auction. Should the auction’s highest bid come from a remote bidder, the third-party representative is responsible for collecting the bidder’s proof of funds, which can be verified through an escrow account statement on the auction date. Then, the bidder must transfer their deposit into the Referee’s trust account within one business day of the auction’s conclusion.
It’s still important to note that each bid will be handled by the in-person Referee, just as before.
Going forward, this will likely result in bigger turnouts and more competitive 'bidding wars.' Investors are now able to participate in these auctions from the convenience of their homes or offices, although this could result in higher prices. As a firm that handles foreclosure cases and represents several real estate investors, we are always attentive to developments in this space.
NYSCEF will hold a virtual information session on August 8th via Microsoft Teams to unveil the new program and answer questions.
Questions on how this could affect you? Call us today at (718)-554-6445 to set up a FREE consultation!
Sources: https://ww2.nycourts.gov/remote-bidding-foreclosure-auctions-36221
https://www.nycourts.gov/LegacyPDFS/COURTS/11jd/supreme/civilterm/partrules/foreclosure_auction_rules.pdf
