Terms

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The Basics (The "Who" and "What")

• Consignment: The act of turning over items to an auction house to be sold on your behalf.

• Lot: A single item or a group of items offered for sale as one unit.

• Cataloging: The process of describing and photographing items to prepare them for sale.​

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Pricing & Bidding (The "How Much")

• Reserve Price: The minimum price a seller is willing to accept. If bidding doesn't hit this number, the item isn't sold.

• Hammer Price: The winning bid amount when the auctioneer drops the gavel (does not include extra fees).

• Buyer’s Premium (BP): An additional percentage fee paid by the buyer on top of the hammer price.

• Contract Price: This is the "all-in" number that goes on the official purchase agreement. This is the figure used to calculate transfer taxes and title insurance.

• Seller’s Commission: The percentage of the sale price that the auction house keeps as their fee.

• Fair Market Value (FMV): The price an item would sell for on the open market—a crucial term in probate and estate law.

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The Process (The "Action")

• As-Is, Where-Is: A legal term meaning the buyer is responsible for the item's condition and removal. This removes the "hurdle" of the estate having to make repairs.

• Valuation/Appraisal: An expert's estimate of what an item is worth before it goes to auction.

• Liquidation: The process of quickly turning physical assets (furniture, jewelry, cars) into cash for the estate.

• Absolute Auction: An auction where there is no reserve; the item sells to the highest bidder regardless of price.