Profile picture for antoniusb

Sheriff Auction Sale

So I am tracking a property in my neighborhood with a current market value of at least $200K (clean title, no liens).

It was foreclosed with a judgment of $440K against the owner and then sold at auction for $100. The buyer was the attorney for the bank named in the foreclosure so I am assuming that the bank bought the property at the auction.

Is the reason that the sale price was that low because the bank would have met any bid close to the market price therefore discouraging bidders? I am assuming that the judgment against the previous owner doesn't attach to a potential new buyer. I am just trying to understand why the sale price on a property with a value of at least $200K would sell at auction for $100.So I am tracking a property in my neighborhood with a current market value of about $200K (clean title, no liens).

It was foreclosed with a judgment of $440K against the owner and then sold at auction for $100. The buyer was the attorney for the bank named in the foreclosure so I am assuming that the bank bought the property at the auction.

Is the reason that the sale price was that low because the bank would have met any bid close to the market price therefore discouraging bidders? I am assuming that the judgment against the previous owner doesn't attach to a potential new buyer. I am just trying to understand why the sale price on a property with a value of at least $200K would sell at auction for $100.
  • July 21 2009 - Miami
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Answers (3)

Profile picture for Danielmailin
If you ever go to one of these auctions, you will see that the starting bid for any property is $100.  There is always someone representing the bank at the moment of aucttion.  If any one is intreseted on biding for the home, then the bidding will start from there.  Of course no house sells fo $100, the bank always has a reserve number that they are willing to goup to, which is allways disclosed before the bidding starts.

Exmaple, the bank migth say they would go as hig as 140K for this property, but the biiding will start at $100 by the bidding judge, if no one is intrested in bidding, then the bidding judge will give it back to the bank for $100.

After that happends, the bank could sell the property as foreclosed, but this still takes a while before you actually see the home in the market sold as foreclosure.

I hope this answers your question.

By the way, going to this auctions is a waste of time unless you have a lot of cash in hand to compete against banks.
  • July 22 2009
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Anyone but the bank that held the mortgage would've had to have bid 440k to obtain the property.

Obviously with a value of 200k, there were no takers.
  • July 21 2009
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Yes - the bank took the property back.  Most likely due to the market - there was a lack of interested buyers at the Court Sale.  The investors who work these sales are a tight community and the representatives of the bank will be present and will inform the investors that the bank plans to take the house back.  Some investors will still try - currently I think the bank will let it go if someone bids decent enough.  The banks don't really want the properties now.
  • July 21 2009
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