Simply stated, you don't. Although if the auction company is ran by half-way hungry people, they will take a second and third back up contract from the other bidders, but in most cases that I have seen lately, if the winning bid doesn't close the deal, the lender sure as heck isn't going to approve the second place bid.
This exchange got me thinking about an auction thread from the beginning of the year.
In that thread I asked some questions about an auction that took place in Sarasota where the auction house reported it set a record price of $14 Million (for a $20 Million estate).
[ame="http://sowal.com/bb/showpost.php?p=339225&postcount=25"]SoWal Beaches Forum - View Single Post - Sotheby's Auction[/ame]
Poster "Sea Sotheby" was very professional and actually took time to answer my question:
[ame="http://sowal.com/bb/showpost.php?p=339843&postcount=28"]SoWal Beaches Forum - View Single Post - Sotheby's Auction[/ame]
I googled it to see how things were going and came up with this article written April '08:
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SARASOTA - Wolf Arbin Weinhold believes his father killed his mother. His brother believes it, too.
Weinhold, a maybe-wealthy 54-year-old Sarasotan, says that in 1991 his late father fed crushed sleeping pills to his cancer-stricken mother, then put a plastic bag over her head until she stopped breathing. His brother, Karl Wilms "Kip" Weinhold, says his father told him the story soon after his mother's death. But Kip still is not sure whether it was a mercy killing or murder.
"I just don't know," he said.
Five months ago, Wolf Weinhold made a very big splash, offering $14.1 million for the Sugar Bay estate on Casey Key -- the flagship property in Sarasota's biggest and glitziest real estate auction ever. Weinhold's deposit checks bounced, and half the property has since sold to another buyer.
Weinhold, the auctioneers, the auction's sponsor and the property's owner are now entangled in messy arbitration over the main parcel, and the Sarasota real estate community is bickering over how it all happened and who is to blame.
Wolf Weinhold says his bid for Sugar Bay was legitimate.
"I would not blow my brains out by doing something foolish like that," he said.
He intended to buy the property as a business venture, he said, explaining that he had extensive contacts from his Harvard and MIT days with those running certain sovereign wealth funds on behalf of governments around the world. He said it is not uncommon for a wealthy individual to want to buy property through an intermediary to stay below the radar.
"Over the years I've looked for property for myself, but also for friends and clients," Weinhold said. "I've put deals together like this before."
Kip Weinhold said that it is possible his brother intended to buy the Petrik estate on behalf of someone he had met during his Boston years. But Kip Weinhold said he thought it more likely that his brother had acted on impulse.
"When my brother called and told me about it, I got sick to my stomach," said Kip Weinhold, who received a call from his brother in February. "If he had told me beforehand that he was going to bid on some property, I would have locked him in a little room."
Wolf Weinhold now says that the best possible outcome would be for him to get out of the Sugar Bay deal.
"If the arbitration rules against me, the judgment will be paid and the property will be bought," Weinhold said. "If it goes the other way, I'll get all my costs and expenses back."
But Kip Weinhold worries that his brother could face criminal charges for writing a bad check.
http://www.heraldtribune.com/apps/pbcs.dll/article?AID=/20080427/REALESTATE/804270560/2055
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Oh, and by the way...the house is still up for sale:
http://fl.skysothebysrealty.com/sarasota/388906/
Funny things, these auctions.
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