Opening Bid way below amount owed

6 Replies

hi everyone, I'm brand new here and have a question about a certain property. I hope this is allowed. The property in question has a $30,000 opening bid, but $127,000 is owed on the mortgage (which is probably about what it's worth). I know that there is also less than $10,000 in back taxes as well. Would the bank really start this low just to get it off their hands? Here is a link to the property I question.

We buy houses on every couple of months and there is always a reserve price that needs to be met.  The "winning" bid will go to the bank and if it does not meet the reserve they will counter with a much higher one.  You then have the choice to accept the counter or let it go and get your money back. 

If you track a certain property you can usually see it go through a few cycles and get a good idea what the bank is looking for.  Some of the other auction sites will say whether the reserve has been met and sometimes you have to bid against yourself to meet the reserve since the banks counter can sometimes be higher than the minimum reserve.

Just like ebay, most bids stay low until the last half a day or so and then they start taking off.  It is not uncommon to see properties go up tens or hundreds of thousands of dollars in the last few hours depending on how many people are bidding and which ones have "automatic" bid raises in place.

Good Luck has all the answers to your questions and they are pretty strict ask the Realtor or get a Realtor who know how works. 

Hope you do well.

Happy Investing!

You are right. That sounds very strange. It is a very deep discount. If you are interested in it I would keep digging. And if you can, make an offer if its a good deal. You may end up with a property with plenty of equity