How to prepare before the auction
Buying at an auction requires the potential buyer to be well prepared. The civil law notary is required to place an auction notice in one or more local newspapers no later than 30 days before of the auction. Beside the notice in the newspaper, all auctioned properties are described in detail on this website. The dates of the upcoming auctions are shown at the top of this page. These links will refer you to the properties on auction on that date. There are usually more than one upcoming auction. You can find the properties on auction on a specific date by clicking on that link.
Get to know the details of the property on auction
The description of the auctioned properties includes:
1. Mention of a foreclosure (ex article 3:268 Civil Code) by a mortgagee (bank, financial institution, or private) or a foreclosure (ex articles 502 through 513 Civil Law/Court Proceedings) pursuant to a lien
2. Date, time and place of the auction
3. Description of the property on auction
4. Reserve price of the property on auction
5. Links to an appraisal report, the estimate of costs and the special auction conditions for the property on auction
6. Other information of interest, including photographs of the properties when available
Prepare your documents before the auction
Potential buyers (at the auction as well as private bidders; more on that here below) shall identify themselves with a valid passport, driver's license or ID-card and also provide the civil law notary with proof of funds, such as a bank guarantee, showing that they have sufficient funds to pay the purchase price and the additional costs and charges.
Read the general and special auction conditions
It is important for potential buyers to consult with the general and special conditions before the auction. The special auction conditions are determined by the mortgagee. The auction shall be held according to the auction conditions. Besides any applicable special auction conditions, auctions shall be subject to any legal restrictions that apply to that property such as lease agreements, easements, or certain charges or obligations for which the bank has excluded any liability. Any such restrictions shall also be announced prior to the commencement of the auction.
The auction procedure
Each bid shall be irrevocable, unconditional and without reservations.
The auction shall consist of two rounds for each property through a Dutch auction system.
The first round (opbod ; raising bids) shall take place by raising bids of USD 1,000 or an amount higher as confirmed by the bidder, which session will be concluded when the highest bid has been confirmed. If the reserve price established by the seller of a certain property has been set at USD 300,000, all bids during the first round shall start from this amount and end at the highest bid, for instance at USD 330,000. After asking the potential buyers for three successive times if anybody wants to bid higher and no such higher bid has been placed, the civil law notary will close the first round.
The second round (afmijnen ; decreasing bids) shall consist of a sale by decreasing bids. In the example above, if the first round ended with the highest bid at USD 330,000, the seller shall instruct the civil law notary to add an additional amount as a starting price for the second round. For example an amount of USD 50,000 has been added to the highest bid of USD 330,000 and that the decreasing bids have been set at USD 2,000 each. This means that the civil law notary shall start auctioning from an amount of USD 380,000 and decreasing the amount with USD 2,000 each time, until a bidder calls mine while raising their hand. If this happens before the amount is lowered to the original bidding price of USD 330,000, for example at USD 340,000, then this amount will be the final auctioning amount and this bid shall prevail over the highest bid in the first round. However, if no such bid is made in the second round then the highest bid in the first round shall be the final bid.
The bidder who has placed the highest bid in the first round, can still bid in the second round. Please note as well that if no bids are made in the first round, the civil law notary will not proceed to a second round of bidding but instead close the auction without the property being sold.
Private Bids before the auction
In case of a foreclosure by a mortgagee the auction notice shall also confirm if potential buyers are allowed to make a private bid to buy the property before the auction date. A private bid is not allowed by law in case of a foreclosure pursuant to a lien. This private bid shall confirm the price being offered by the buyer, which shall be equal to or higher than the reserve price.
The private bid shall be addressed to the civil law notary in writing at the latest two (2) weeks before the date of the auction, and shall be irrevocable. The civil law notary shall relay these private bids to the mortgagee and the debtor. The mortgagee as well as the debtor have the right to instruct the civil law notary to submit the private bid of their choice to the Court of First Instance in Aruba for approval. Once such bid has been submitted to the Court, the auction will be suspended until a ruling has been rendered. The Court shall determine if said private bid is acceptable for all the creditors (mortgages, liens/attachments, etc.) and the debtor. The Court shall reject the private bid in the event the Court is of the opinion that the property would yield a higher amount at the auction. In the event that the Court approves the private bid the sale shall be executed privately and the public auction will be cancelled.
If you have any further questions concerning the above, please call our office and you will be referred to our auction expert.
The auction is subject to the general auction conditions and special auction conditions which will be determined by notary T.R. Johnson in a separate notarial deed for every separate property.
The auction will take place by raising bids (bij opbod) and by decreasing bids (bij afmijning) in one session.
Seller has the right to not accept any bid, at his sole discretion.
All auction costs are for the account of the buyer, which costs include: transfer tax, registration fees Land Registry, the outstanding long lease fees (erfpacht canon) and property taxes (grondbelasting) for execution of the necessary notarial deeds, other auction costs (rent of auction room, bailiff fees, cancellation of liens and mortgages, advertisements), and the costs to have the property vacated, if necessary.
Each bidder must be able to submit a bank-guarantee issued by a reputable bank in Aruba (or another proof of funds acceptable to the Seller) to the amount of the highest bid increased with an amount equal to the auction costs.
The auction may be stopped or postponed at any time.