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Q: What is an Auction?
A: In the State of Tennessee, “Auction” means a sales transaction conducted by means of oral or written exchange between an auctioneer and members of the audience, which exchange consists of a series of invitations for offers for purchase of goods or real estate made by the auctioneer and offers for purchase made by members of the audience culminating in the acceptance by the auctioneer or most favorable offer made by a member of the participating audience.
Q: What are the different types of Auctions?
A: See "Types of Auctions" page.
Q: What is a “Lot”?
A: A Lot is what is being offered for sale by the auctioneer. It could be a parcel of real estate, a painting, a group of chairs, etc.
Q: What qualifications do I need to bid at an auction?
A: Different auctions have different requirements. All auctions require the bidder to provide proper, valid identification. Many real estate auctions or other auctions involving valuable property may require prior financial approval, indicating the bidder’s ability to pay.
Q: How do I bid?
A: A: In order to bid on an item, simply get the auctioneer’s attention and indicate to him or her, your intention to bid on the item up for sale. Holding your bid card up, making eye contact and nodding in the affirmative, speaking up… there are as many different ways to bid on an item as there are bidders. It is usually possible to get the attention of one of the auctioneer’s staff, called a ringman. These are individuals who assist the auctioneer during the auction recognizing bids and bidders in the audience.
Q: What is a Buyer’s Premium?
A: A: A Buyer’s Premium is a cost incurred by the buyer which is a percentage of the final winning bid amount for that lot. Tennessee state law requires that the auction company advertise and announce that there is a buyer’s premium in effect for the sale. It works like this. A bidder attends an auction that has a 10% buyer’s premium. He wins an item with a winning bid of $100. When the bidder pays for the item, the final total will reflect that 10% buyer’s premium and he will owe $110, plus any applicable tax.
Q: What does “times the money” mean?
A: “Times the Money” is a phrase and method that the auctioneer uses to sell a particular lot. Let’s say that a lot of 6 dining room chairs is being offered. They are being sold “times the money,” which the auctioneer will announce before the lot goes up for sale. A bidder is offering his bid with the understanding that, although the bid is reflecting an offer to buy one chair, he will be buying all six chairs at the winning bid amount times six. (The winning bid is $40. The winning bidder owes $40 X 6 Chairs= $240)
Q: What does “selling choice” mean?
A: “Selling Choice” means that if several items are being sold in a lot, then the winning bidder has the choice of taking one or more (or all) of the items in that lot times the winning bid amount. Let us say that there are 4 tracts of land being offered for sale. The bidders are bidding on the right to choose which tract(s) they want to buy at that winning bid amount. The novelty of “selling choice” is that there may be one or more items within the lot that are particularly desirable. Unless you are the winning bidder, then you run the risk of having someone else choose the tract(s) that you wanted!