Foreclosure Auction Process

Foreclosure Auctions are an opportunity to make great investments. This is a brief introduction.

A property owner can have liens against her/his property. This could be anything from first mortgages, second mortgages, judgment lien, income tax liens, nuisance liens, demolition liens, home owner association liens, and others.

Some liens have priority over others. For example, A first mortgage has priority over second mortgages and home owner association liens.

A lien holder can force an auction of the property to pay off the lien with a Foreclosure action in court. When the court approves the foreclosure, a Final Judgment amount is set for the amount owed to the lien holder.

The Court schedules an auction with No Minimum bid and lists the Address, Parcel Number, Assessed value, Final Judgment, and other information.

Note: This is the Assessed Value, not the Just Value of the property. If the property owner lives at the house, the assessed value cannot be increased by more than 3% per year. Over time, the Just Value can be much higher than the assessed value. Our listings show the Just Value instead of the Assessed Value.

The court notifies anyone that has a lien on the property about the auction. This could be anything from mortgages, judgments, income tax liens, nuisance liens, demolition liens, home owner association liens, and others. This gives them an opportunity to bid on the property and protect their lien.

If the property goes to auction, most liens survive the auction. The auction winner gets immediate possession of the property. A higher priority lien holder can still foreclose on the property.

The property owner can avoid the auction at any time before the sale by paying the lien or coming to an agreement with the lienholder such as a short sale or deed in lieu of foreclosure.

This information is not intended as legal advice. Please be sure to do your due diligence before bidding.