I Almost Bought Properties at Auction (Here’s What Stopped Me!)

by | BiggerPockets.com

As you may have noticed in your local market, it is SUPER competitive right now to find good deals. This might be specific to our local market, but I have spoken to many active investors across the country, and the consensus is the same. It is hard to find a good deal. Well, I am of the opinion that there are always deals to find, but as the marketplace gets more competitive, you have to get more creative and resourceful.

My husband Matt and I were looking ahead and realized that as a few projects closed, we were low on inventory and needed more properties in our pipeline. Currently, we buy property mainly through wholesalers, residential and commercial brokers, and the MLS.

Side note: For those who think the MLS is a complete waste of time, that is not always true! We actually just closed on a duplex in Trenton that was listed on the MLS. It was a HomePath property, so we had to monitor when investors could purchase the property. We did monitor it closely and bought it for below asking for $28k. It needs about $45k in work, and the ARV is $125k. Not a bad deal, right? Don’t dismiss the MLS!

Back to my auction story and lesson.We are currently buying a few different types of properties. We are actively looking for three types of real estate: (1) multifamilies (50+ units) in PA, (2) smaller multifamily and single family properties in our trading area of Mercer County to fix and either hold or sell to an investor, and (3) single family homes to fix and flip close to us that we can sell to an end buyer.

Since we have some ambitious buying goals right now, we knew we needed to try something different, so we decided to begin attending the local auctions—both county and city. This process has taught us a bunch of great lessons—one in particular that we want to share with the BP community!


Attending the City Auction

The first auction we attended was the local city auction. Here in the City of Trenton, they hold these auctions four times a year. They do a great job of listing as much information as they can about these properties. They also give time blocks to go and tour them. This is incredibly helpful and very different from some other auctions where you can’t even access the inside of the property before the actual auction.

They required a $150 registration fee for anyone who was going to bid on properties, as well as a 10% deposit on the purchase price, which was nonrefundable if you backed out of the deal. We went through the entire list of about 40 properties and made a short list of about four that we really wanted. There were two that we REALLY wanted—a commercial building close to some of our other buildings and a mixed use building across the street from another 4-unit we own.

As the auction began, there were probably about 100 people in attendance. It was a packed house! Right off the bat, we knew there would be a lot of competition. Something else to note, most of these properties at the city auction were properties that were completely dilapidated. Some of them had structural problems that we typically stay away from. That is why it is key to get into these properties before making a bid.

Related: Going Once, Going Twice: How to Win at a Real Estate Auction

As the auction began, we waited patiently for our deals to be announced. Unfortunately, we lost in the bidding for all the properties we wanted! The commercial building ended up going for $65k, while our maximum bid was $40k. The mixed use building we really liked sold for DOUBLE our max bid! It was a feeding frenzy on every property, including the ones that were in really bad condition in bad neighborhoods.

Tip: If you decide to participate in auctions, determine your maximum bid AHEAD OF TIME, and stick to this number. Don’t increase your bid because of the competition. Remember, competition will always drive up prices!

Of course, we were disappointed that we did not purchase any properties at this auction; however, we brushed it off and decided to focus our energy on the County Auctions.

Moving on to the County Auctions

We decided to attend a couple of the County Sheriff Sales (Mercer County, NJ) before bidding. That was actually a smart idea. We became comfortable with the process and learned all about the environment we were stepping into. The way this county works is that they have a list (a 352-page list might I add) of all the addresses, the amounts due the bank, and the auction dates listed on their website. I actually printed this incredibly large document so I could begin to highlight which properties were listed for which date. The City Auction was a little easier for us. We know just about every street and area of Trenton, so it was easy for us to go through the list and see which ones we wanted to bid on and which ones we did not want to bid on. Bidding at the county level took a lot more research and fact finding.

For several weeks, we made a list of the properties going up for auction that week. We attended and talked to as many people as we could. Unlike at the city auction, you don’t have to pay a registration fee, but you do have to register if you plan on bidding. They also ask you to “show your money,” which I found very interesting. They want to see proof that you have cashier checks (or cash) to prove that you are for real. I saw one guy carrying around an envelope with what had to be close to $50k CASH inside it! I was floored that someone would feel comfortable walking around with that much money.

Once we got comfortable, we decided to begin bidding. We went three consecutive weeks and bid on multiple properties. We made a spreadsheet that included the address, the bank amount owed, the upset price, our maximum bid, ARV, bed/bath, square feet, and notes. (The upset price is the amount the bank is willing to accept to payoff their loan, and it’s the starting bid. The bank might be owed $300,000, but the upset price could be $150,000.) The key is knowing what this upset price is prior to the auction.

The whole point of this game is to determine if you can buy below market.

Each week, I put a ton of my time into this initiative. I would list all the properties that were coming up for auction, I would determine if it was worth our time, and I would research on the MLS for ARVs and public records to learn as much as I could about the property. There were about 30 properties on our list. So you can do the math—it took me a while to do all of this research. During last week’s auction, there was one property that was a condo and the upset was $15k. This was an awesome deal, and the ARV would be $70-80k. Well, everyone else at the auction knew it was a good deal too, and it ended up selling for $50k (and our maximum number was $25k).

So yet again, we were not willing to move beyond our maximum bid and got outbid.


Key Lesson We Learned

After last week’s auction, I turned to my husband Matt and said, “This does not seem to be working.” He looked at me and agreed. First of all, when you attend many of these auctions, there are a handful of “players” in the room. These “players” make it their JOB to attend these auctions and have the inside track on this process and the properties. So, in a nutshell, we are competing with people who bid at auctions as their main JOB. Many of them bid against each other to just drive up prices. You are not going to get a “good” deal when you are positioned this way. Plus, you have to do an incredible amount of research to even determine what is a good deal and what is not a good deal. You can’t even get into these properties to verify anything. We decided we were not comfortable with this level of risk.

So after this realization and learning, we decided to do a better job of staying in front of the wholesalers we have bought properties from in the past on a more regular basis. This week, we reached out to key wholesalers and REO real estate agents whom we have worked with in the past and told them what we were looking for. They all had some deals in the works, so that is promising.

Related: Why Investors Lose Money on 27 Percent of all Auction Deals

Additionally, one of the main “players” at the county auction is another wholesaler we have done business with and who is also one of our commercial tenants. Since we have done business with him before, we decided that if we buy auction properties moving forward. they will be through him. Instead of us doing all the research and putting all the time into the auction process ourselves, our time and energy is better spent getting in front of wholesalers to find off market deals that are less competitive.

We would rather pay this wholesaler or any other wholesaler their $2,500-$5,000 fee for a good deal instead of having to participate in the process of getting these deals under contract ourselves. Wholesalers spend a lot of time getting deals under contract. And they should get paid for their efforts.

The bottom line is how precious is your time? Everything else in this business is unlimited. Time, after all, is the one limited resource. No matter how experienced or how inexperienced you are in this business, you continually have to evaluate how your time is being spent and what the best ways to achieve your goals are.

We’re republishing this article to help out our newer readers.

I am curious to hear your experiences. What real estate investing activities have you outsourced? How did it work out for you?

Thanks for reading and be sure to leave a comment below!

About Author

Elizabeth Faircloth

Liz Faircloth has been managing and investing in real estate since 2004, along with her husband, Matt. We have built our business from scratch and now own over five million dollars in residential and commercial assets. We love to help and educate investors. Our YouTube Channel, The Landlord’s Chronicles, offers short, yet educational videos that covers topics such as flipping houses, rentals, rehabs, property management, and lessons learned along the way. http://www.youtube.com/c/DerosaGroupTrenton


  1. Stephen S.

    My question is: where do you find wholesalers who are willing to charge the “$2,500-$5,000 fee for a good deal” that you reference?

    I ask because my experience with wholesalers seems to indicate that they are either looking for much more than a $5000. fee for their end of things – or they are really bad at finding good deals.

    And I am talking about properties where the $5K would represent more than 10% of the purchase price.

    • Elizabeth Faircloth

      Hi Stephen:
      Thanks for reading the blog post and thanks for submitting a great question. It has taken us some time to build relationships with the right wholesalers. There are some great ones out there and some that add no value and charge a ton. I have a couple of thoughts for you – In our experience we have been able to find more active wholesalers in markets that are highly dense with properties like a city (vs the suburbs). I would then attend as many meet up and networking groups for real estate investors in these specific areas. Once you meet some potential wholesalers to work with, pick their brain and determine if they are a quality person to potentially work with. And once you find a good wholesaler – stay in front of them so they keep you in mind for the next deal they find. The other idea is to attend auctions and figure out who the players are. Chances are most of these people bidding are going to wholesale the deals vs holding onto the properties themselves.
      Hope this helps!!

  2. beau lauber

    Nice article. Its a tough market out there. We had a similar experience with an estate sale auction. This 2/1 was dilapidated and needed about 30k in rehab. It went for 10k above ARV. Crazy, I still gotta wonder how these people are buying these deals with no room for rehab. Are they just inexperienced? SMH

    • Elizabeth Faircloth

      Hi Beau:
      Great point indeed! Yes I would chalk it up as inexperience – either with local market or real estate investing in general. Or they are not doing their homework before these auctions. Or they are getting some very bad advice from their realtor!!
      In a competitive market, people do some funny things to break into the business!
      Thanks for reading and commenting!

  3. Mike McKinzie

    The same can be said for ANY auction. Not only have I seen $80,000 houses sell for $150,000, I have seen a $20 silver dollar coin sell for over $100 at an estate auction, I have seen a one ounce gold bar sell for DOUBLE the gold spot price and I have seen a Play Station 3 sell for double what it cost at Wal Mart down the street. Auctions are designed to drive up prices so if you want to jump into that game, you need to do a lot of research. One more quick story. A friend of mine really wanted this multi million dollar commercial property. So when it went up for auction, he noticed he had a group bidding against him very strongly. In the midst of the auction, a man from the group came up to my friend and said “If you want us to stop bidding, it will cost you $10,000.00.” He agreed and got the property. His revenge was giving them a 1099 at the end of the year and recording the expense as a referral fee. The auction world is a SHARK TANK and if you want to swim there, you need to be equipped.

    • Elizabeth Faircloth

      Hi Mike,
      You are absolutely on target. All types of auctions have a lot in common. And anyone that wants to participate better do their research and fact finding. I can’t say I am surprised of the story you shared. I love how he sent these guys a 1099 at the end of the year! Great idea!!
      Thanks for reading and commenting!

  4. I’ve bought many properties at auction and, yes, you end up spinning your wheels a lot of the time. You see the same faces at every auction and I think for some it’s a numbers game. They will sometimes buy marginal deals to keep their crews busy and will buy properties with low profit potential because they buy in volume. The pro’s can take a few hits whereas a newbie can get wiped out with one bad deal. Sometimes you will have a newbie overpay or someone who intends to occupy pay more than an investor would. I’ve bought a few personal residences where I have gone higher than I would have had it been a flip. I can still get a very good deal as opposed to “market price” for a place I really want to live in. Not that I ever pay “market”.

    It is important to determine your “number” before you go so you won’t get caught up in the bidding. I’ve only lost money on one although I have only broken even on a few. At this point I only scan the notices for neighborhoods that I know extremely well. It cuts down on the legwork and I only do a few flips a year. I’m currently looking for a deal in a very specific area for my son’s first home.

    Also, having cash (as opposed to hard money) allows an investor to go higher and achieve the same profit.

    • Elizabeth Faircloth

      Hi Cherylc:

      Thanks for reading and sharing your experience with me and the BP community. Your points are right on target. Deals can be made at auctions -but like you said having cash, being prepared, doing your research, being able to act smart and quickly and knowing your max bid are all critical to having success with auctions.

      Thanks for sharing!

  5. I have spent a lot of time at auctions. You do see the same people again and again. Some of these people do not have to show their money like the rest of us. they just show the business card with the name of the hedge fund they represent. A lot of hedge funds overbid properties. With the market being flat, they are under a lot of pressure to put the client’s money somewhere, anywhere. They cannot justify the 2 and 20 fee structure for holding cash.

    • Darrell Wild

      I am shocked to read about so many buyers of real estate, each determining the value, but never with details as to what they have done to assure themselves as to the cost to repair, replace and market the property to an end user. In today’s world, if I had not spend twenty years in the construction business, I would not think about buying a property that needed repairs and improvements. I feel like I am reading a bunch of fairy tales.

  6. I went to one auction and decided it was a complete waste of time. The properties were being bid up beyond what I thought they were worth.

    I have purchased a few good houses at online auctions. The HUD website is essentially an online auction. There can be decent deals on Hubzu and others. You can usually get inside HUD houses and many REOs that are on online auction terms can be viewed as well. The utilities are usually off, but a decent contractor can tell you if the furnace, HW tank and other major things are shot or not.

    It takes a lot of patience and discipline. The best deals are the houses that have been out there for many months. Investors get sick of seeing them and sick of the reserve price being too high. Eventually the owner ( usually the bank) gets tired of holding the house, paying the taxes, and cutting the grass, etc. You want to be there when others are ignoring the property and the bank wants to dump it.

    • Elizabeth Faircloth

      Thanks for commenting and sharing your thoughts. Glad to hear the online auctions have worked well for you. Have you been able to get into these properties that you view online? Good point about keeping an eye out for the properties that have been out there for a while. There is always a reason a property is still for sale. However, with patience, some very good deals can surface. Once you have been the winning bid for a property through an online auction, how long did it take to close on the property?

      • Hi Liz,

        With on line REOs, I can always visit the property and conduct an inspection. Every property and situation is different. HUD properties typically must close within 45 days. Some bank owned are very fast; others take months and months. Now that markets have stabilized somewhat, once I tie up a property, I don’t care how long it takes to close.

        Once I was the winner at an auction and it turned out the owner did not have clear title. I got my earnest money back and the house is still sitting vacant a year later.

    • Never heard such a thing. I have purchased 3 homes through online auctions (2 with Auction.com, 1 with Williams and Williams). All closed in 30 days, got them all at pretty good prices. No big problems, but sometimes communication between buyer, auction company, and title company can be less than perfect… probably to be expected given the volume they deal with.

      • Elizabeth Faircloth

        Hi Steve,
        Thanks for jumping into the discussion! I am not familiar with “william and william” online auction. Sounds like a law firm. Also, in situations like this (with online auctions) can you choose your title company?
        Thanks Steve!

        • Hi Liz,

          Yes, you can choose your own title company. I have done it both ways, and will always use my own in the future!

          In addition to the companies I have used, I also look at Hubzu, Homesearch, Hudson and Marshall, and Xome… just have not closed a deal with them yet. You may want to check them out.

          Take Care, and thanks for the great articles, Steve

  7. Angela Kriv

    Great Article, Thanks!! The auction in the area where I am looking is an online one and I participated in one. Of course, I did a lot of homework – title search, knew location, deposit, registration, etc. It is a very smart system since you cannot bid more than your deposit allow you to, so even if I wanted to my max was 25K. I ended up not getting the property since the price went up very high. My question thou is how do you know the upset price?? I never saw it anywhere being published, at least on auction I am looking. Thanks!

    • Elizabeth Faircloth

      Hi Angela,
      Great question! Sometimes you can call the office (who handles the auction) on the day of the auction and they may have this. Sometimes I have heard that you can call the law office representing the property and ask them the upset price the morning of the auction. Additionally, the banks represending the properties send a person to these auctions who shares the upset price when each address/property is named during the auction. You can show up early to bump into this representative day of the auction and see if he/she will share the upset prices prior to the auction beginning. This has worked for us.
      Hope this helps!

  8. William Morrison

    Great read.
    I’ve been to a few as well bid online.
    Online with several, I just got fed up with the fake bidders. Check independent reviews and investigations. Some of those even have the names of the guys who have moved from site to site. The last online property for me was one where the bid at the last second was high, the the property didn’t close, It was put back on the market below the high bid. By the way they had the right to go to the second low “me” if they chose to. After a couple rounds of this I move on. I tracked the property and it eventually sold below my bid.
    On site County/City seems to be so specific to that jurisdiction. One I showed up early to just to watch. The guy nest to me bids for several people. As people showed up he would tell me who they were and what types of property they generally look for. Then who the bank bidders were. They’d bid at a higher amount than I would expect and then the property was listed for sale months later at about 2/3s the winning bid.
    Just a lot of work as you suggested.

    • Elizabeth Faircloth

      Hi William,
      Thanks for your comment and feedback. Any piece of this business takes time, energy and focus to be successful – including being effective at auctions. However, the key is to evaluate how involved you choose to be and how you can achieve your investing goals with learning the in’s and out’s yourself or partnering with someone who already has the inside track. No right or wrong answer! Just helpful to be clear on where you want to spend your time and resources.
      Thanks again!

  9. john horner

    I actually started bidding at the County Auction about 3 months ago. In my County they have an auction once a week, and usually bid between 60-80 properties per week. The first 4 weeks I went I didn’t get anything. However, I kept at it and in the next 4 weeks I picked up 4 properties! It is a lot of work just as you explained, but for me the perseverance paid off and we started picking a few up. I’m hoping I can pick up at least 20 additional properties per year at the auction!

  10. Joel Owens

    You have to find the properties without all the eyeballs on them already. That’s for any asset class.

    Auctions for me over the years are a waste of time. Always gets overbid by others. Auction.con uses shell bidding on behalf of the seller to try to get the price up to the sellers reserve so you can be bidding against yourself. I think it should be illegal for them to do this.

    • William Morrison

      Joel Auction.con is not the only one, just what I was saying above. And some individuals have moved from one site to another. Several online reviews have been tracking them. But it takes time.
      It would be nice if it was a true auction with a minimum. It makes all the the online auctions have a bad name, deserved or not.
      The VA used to run their own. I bought several through them. They rolled theirs to an outside source.

  11. Zee Owm

    Hi Elizabeth, I just saw your blog today while researching on county auctions and wondering if someone could tell me how you do your due diligence on a property that is in foreclosure.
    I’ve attended 2 auction sessions just to familiarize myself how to bid, how many people bid, to know how competitive, etc… By the way, I’m a newbie in this auction situation (I have 2 family rental in Hudson county) and adding more buy and hold rentals in my portfolio.

    Now, that I kinda know how it goes in the sheriff auctions, what steps by steps I need to do for “due diligence”.
    1. taxes – tax assesor
    2. sewer/water – municipal office
    3. mortgate/liens — online search from county clerk
    –im not sure if this is enough although it was said that it is current and updated frequently.
    4. comps – so I can derive my min and max bid. I use online(zillow/trulia/realtor) to find the previous sold figures.

    From the list above, are there any other things that I need to be aware of ? I’m still not that confident to pull the trigger, i feel that I’m still missing something. I hope this is not the analysis paralysis syndrome. 🙂

    Do I need to hire title search? Is that necessary or going to county clerk is enough in New jersey?

    Thanks in advance.

    • When you are at the county clerk, do not restrict your search to only the house address. After you find out the name of the owner, look for all records related to that owner. For example, the fact that the house is collateral for a $100,000 bail bond might not show up in a HOUSE search. An IRS lien on the house might also be associated with the owner’s name, not the house address.

      I would also use the county clerk to verify all sales reported on zillow et al. Sometimes sales do not make their way to zillow. Also you might find that zillow records as sales some transactions that are not sales. For example, an entity purchases the house and records the sale. Then they sell very soon to another entity. This might look like a flip because of the big difference in the prices, but in actually the two entities are so closely related as to be effectively the same “person.” The reason for the second “sale” is to artificially raise the cost basis for tax purposes. If you also check with the planning and permits office, you will find out what work has been done, or whether the house has been tagged for enforcement. A lot of investors overbid a tagged house, and after they become the new owner, they will be required to expensively abate the enforcement issues, quickly turning a bargain house into a money pit. If you see permits, call the contractor. They are usually happy to tell you about the house.

      If possible, you should drive by the house to see if it is occupied. Buying a house at auction that has a tenant, owner, or sometimes a squatter living in it means another layer of difficulty in getting the occupant removed. If the house is unoccupied, you can usually walk around and see the condition of the exterior as well as some of the interior.

      Do not let anything about the actual auction push you to bid more than you determined in advance. The hedge funds routinely overbid houses. It is best to avoid a bidding war with them.

      • Darrell Wild

        Katie, You are qualified to purchase a house for the purpose of fixing and flipping. However, you also have the experience to know you will have some that just do not sell and the rent is too low to pay the mortgage. It is a crap game at best. With all your knowledge, why wouldn’t you advance into the larger commercial properties where the municipalities will provide TIF assistance, grants, zoning changes and subordinated loans many times in excess of the equity required?

  12. Zee Owm

    @Katie, thanks a lot! First time I heard about that bail bonds. In the sheriff sale that i went to, they mentioned about the IRS lien (FED and NJ) before the bidding starts.
    I went to the county clerk yesterday and they don’t record any bail bonds and IRS liens. They told me to go to the municipal/county court to find any judgement.
    I’ve seen some of those sales between 2 entities but didn’t pay attention to it until now that you mentioned. I still don’t understand it why they do it to up their cost basis, but i’m pretty sure i will research more on that.
    I really appreciate you sharing your inputs and tips.

    @Elizabeth, thank you for a really nice article very informative especially a newbie like me. I’m trying this route to get experience and see if this something I can do, otherwise i’ll stick with MLS/wholesaler and other investors.

    Thanks a lot all.

    • I do not know about your county,and every county is different and uses different software. In my county, I go to the county clerks office and use their public computer to look up the address. After I get the owner’s name, I look up all records related to that name. I do this for every house I am thinking of buying whether at auction or the conventional way. Buyer’s agents are always surprised that I know so much about the house.

      They want to raise the cost basis because when they calculate their profit, they subtract the cost basis, rehab expenses, holding expenses etc from the proceeds and pay tax on that difference. In my market, they can “reduce” their “profit” by as much as $200,000 in this way, and then think of the tax savings. The problem is these fake “sales” create fake comps. I find I need to bee aware of these fake comps when my buyer’s agent uses one of them to persuade me what I should offer on a fixer. I have to point out that the true comp is actually the first sale, not the second one.

      You are lucky they mentioned the IRS liens before bidding starts. Most auctions do not tell the bidders about any liens.

  13. Amby Agawal

    @Elizabeth Faircloth.
    Great Article!
    I attended the Mercer County auction today. My first one. I went there just to get a feel of the place and everything is exactly as you have mentioned. I was excited and charged up for the real deal in few weeks but you have deflated my balloon to some extent.

    I will attend another 2-3 Wednesdays and then decide what is best way to go about it
    Thanks again for sharing your experience

  14. John Murray

    In my state sheriff’s auction are very tricky. The foreclosure process for a property is about 1 year. Most of the subprime defaults were occupied for up to 8 years because of county recording practices when deeds of trust were bought and sold on the open market. When foreclosure came to fruition the notes were so high because of late fees and penalties through 5-8 years even 10 a sheriff’ auction was moot. The REO game is drying up and the train left the station in my city about 2 years ago.

  15. Greg Parker

    We have bought a few properties at the county auction. It is a combination of “a lot of looking before-hand, and luck”. We got lucky a couple of times when the main players were busy and didn’t show up. On average, we look at 100 properties to find one decent deal. And, THIS IS IMPORTANT, we noticed a couple of young guys always standing in the back of the crowd and never bidding. Well, it turns out they are undercover FBI looking for bid rigging. When someone comes up to you and says, “pay me $10,000 and I wont run the price up”, or I will pay you $10,000 not to run the price up. You are breaking federal anti-trust laws. Several guys in Mobile, Alabama recently went to prison and paid huge fines. They had a big racket going where they all got together and agreed beforehand that only one person would bid a dollar over starting price. Then, they would all get together later and do the payoffs and have secondary auctions. Google it. Very illegal. I almost got suckered into it, but my wife saw a gun on one of the undercover guys and asked him if he was a cop. He spilled the beans and now we watch them video all of the main players looking for a bust. To the guy that paid $10,000 and sent them a 1099, you might want to remove your post. You just admitted to a felony.

  16. I was able to get a decent deal from an online auction at auction.com, which I was able to finance with a conventional mortgage also. I think it really depends on the market conditions. I have noticed the properties on auction.com have moved to live auctions at the courthouse with a cash only requirement since we bought a few years ago.

  17. Greg Parker

    Another thing to keep in mind when buying a house at the county auction, the previous owner or a relative may still have their “stuff” in there. So, when you go to clean out the house, they will drop by and want to know where all of their diamonds and gold bars are. That happened to me recently. I told them, “well, whoever kicked in the back door and vandalized the place, must have taken your millions”. Of course, the tenant was the one who vandalized the place because they were angry they couldn’t live in a free house that once belonged to her aunt.

  18. Kim McCane

    Great article, and absolutely on point. The county I live in has monthly sheriff’s sales. Some of the properties are for delinquent taxes, some are foreclosures. My county requires a $4,000.00 registration fee in order to bid on properties, this must be cash or a certified cashier’s check. If you are the winner on a bid or bids for tax sales properties you must pay the full bid amount plus the sheriff’s fees as soon as the auction is over. If you win a foreclosure bid you must pay 20% of the final bid before 4:00pm the day of sale. The balance plus all the fees and closing cost are due 3 weeks from that day. If for any reason you have trouble getting all your funds together by the specified time, you lose all the money you have shelled out. Then the deed holder has 60 days to make good on their delinquency and reclaim their property before you are issued a deed in your name. The whole process of buying from sheriff’s sales can be overwhelming and exhausting, along with a few other adjectives I will leave to your imagination. RESEARCH IS YOUR BEST FRIEND. There is no such thing as too much research when investing in these kinds of properties. I print a list every month from the county website of all the properties to be auctioned off. I highlight the ones I am interested in. Then I do a Google search on all those properties and print off info I find (this takes hours and not just a couple). Then I hit the roads to find them so I can check out the situation, (the neighborhood, occupancy, the condition, if they are vacant I walk the property take notes, take pictures, if I can get inside the property I do, I talk to the neighbors when possible). This usually takes at least a week. Then i go to the county recorder of deeds and check all the deed and title information. Then it is off to the county tax office and if in town or city limits it’s off to town hall as well to check for delinquent taxes and get accurate totals. Then I go to the county prothonatary office to check for liens against the properties and the deed holders. Then I gather my wits and get my calculator out, do an estimate for repairs or rehab, get a dollar figure on cost associated with the purchase of each individual property with all the fees, commissions, attorney cost, etc. Then I decide on the properties that meet my criteria after all is said and done. Now I have the list of properties to bid on at auction. I set a $ limit for each property and never deviate from it. The auctions go so quick that you do not have time to hem and hull. You must have a plan and stick to it, there is no time to think or regroup during these auctions. They will go through 60 properties in 35-45 minutes. You snooze, you lose.

  19. Darrell Lee

    There’s still lots of deals around in the town of Springfield, Vt. A 3br/1ba units in a 3 unit bldg just sold next door with an asking price of $35k. I rehabbed my small duplex 2/1 and 1/1 and Airbnb it earning around $2k/mo.

    Weird is sfr sell for a lot more than small unit buildings. So when I sell, I will convert back to a sfr for a value of around $120k.

    I bought 7-8 properties sight unseen at auctions. If you buy 5+ from auction.com they may upgrade you to a VIP member so you don’t need to pay a deposit on auctions you are bidding on. Very helpful when I was bidding on 5-10 auctions simultaneously.

    Yes, set your Mac and don’t budge if it doesn’t hit the reserve, after awhile they will lower the reserve. One property took 9 months to win. My 1st rejected bid was $91k and 9mo later my final accepted bid $29k!

    Apparently they can shill bid unlike ebay. Their game is eventually bid just below the reserve so that if you overbid them you will hit the reserve and “win”…

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