Before you can bid in a SARFAESI auction, you have to put down an Earnest Money Deposit, usually 10% of the reserve price. Think of it as a refundable ticket that proves you're serious.
What happens to your EMD
- If you don't win, it's refunded in full.
- If you win, it's adjusted against the final sale price.
- If you win but back out, you can forfeit it, so bid deliberately.
Timing is everything
EMD must reach the bank before the deadline stated in the notice, often a day or two before the auction. Miss it and you can't participate, no matter how good your offer.
