Foreclosure Digest

Real estate foreclosure auctions, sometimes referred to as a sheriff sale, usually take place in a designated area in the county courthouse. Sometimes they can even take place on the steps of the county courthouse.

They are set up to be quick and business-like affairs with rules put in place to help expedite the process. You can expect some regulars to show up and new bidders as well. They may be weekly or bi-weekly events, and can vary depending on the number of foreclosures in the area and the backlog.

How To Buy At Real Estate Foreclosure Auctions

Rules vary from county to county, but you will be usually expected to pay some percentage of your bid upfront once you are declared the winning bidder. Generally expect to pay at least 5% of the value of your bid. You will also need to pay the remainder of the the bid by the end of the business day.

For example,  if you bid $100,000, you might have to pay $5,000 upfront at the end of your winning bid and the rest some time later, usually by the end of the business day.

Bankers Buy Back

The original bids will probably start out with the bank or lender who holds the mortgage bidding a nominal amount to get the bidding moving. They may even bid against you to drive up the price where it reaches an acceptable loss for them.

They don’t want the property but are definitely not going to give it away. That means , if they don’t get the bids they want at the real estate foreclosure auctions, they will simply bid to buy back the house. This keeps them from taking a huge loss on the home.

Do Your Research Before You Go

Real estate foreclosure auctions are fast-paced and you will need to know ahead of time what property you are willing to bid on and the fair market value of it. You should have researched as much as you can about how much is owed, what the neighborhood is like, and what the general condition of the home is like. You will also want to make sure you understand any and all fees or liens associated with the property.

You do not want any surprises after you make your purchase.