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Wednesday, March 9, 2011

Public Tender Vs. Public Auction - What's the Difference?

In this edition of our Company Blog we would like to discuss another very common question we receive from our members regarding tax sales.


Public Tender VS. Public Auction -  What's the Difference? 
 

Tendering or Bidding on a Tax Sale property can be done 1 of 2 ways depending on how the tax sale is being conducted.  Is this a Sale of Land by Public Tender or is it a Sale of Land by Public Auction?

Though, it is very seldom to see a Tax Sale by Public Auction; they do still occur.
These are both procedures for generating competing offers from different tenderers or bidders.
 
 
The two main factors that set these methods apart is how you submit your tender or bid and when the offered tender or bid is due.

Sale of Land by Public Tender

For instance, when making an offer on a property that is being sold by Public Tender, you must submit your offer/tender in a sealed envelope (containing at least 20% of the amount tendered), you have only one chance to be selected as the highest tenderer and cannot re-submit your tender after the tax sale has been conducted. Tenders will be opened on the tax sale date at or as soon as possible after 3:00pm.
According to the Municipal Tax Sale Rules, once the highest tender has been determined, that tenderer will be declared to be the successful purchaser if, within 14 days of the mailing of the notice, the balance of the amount tendered, the applicable land transfer tax and the accumulated taxes are paid, in cash, to the treasurer.

NOTE: This method for tax sale is very similar to a silent auction.


Sale of Land by Public Auction
When making an offer on a property that is being sold by Public Auction, you must be present at the designated location at the time that the tax sale is being conducted.  If you bid on a tax sale property and somebody else out bids you - you have the opportunity to bid again and again until a highest tender has been determined.

According to the Municipal Tax Sale Rules,  the highest bidder shall be declared to be the successful purchaser if the bidder immediately pays the amount bid, the applicable land transfer tax and the accumulated taxes, in cash, to the auctioneer.

NOTE: This method for tax sale is exactly as stated above - 'A Public Auction' - Conducted Aloud  

For more information on the Sale of Land by Public Tender VS. Sale of Land by Public Auction and other helpful information, please visit the link below to view the Ontario Municipal Tax Sale Rules.

Tri-Target.com - Ontario Municipal Tax Sale Rules

Tri-Target.com - Ontario Municipal Tax Sale Legislation

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