1 Property, 5 Foreclosure Sales, 5 Buyers Who Never Checked Public Records.

Foreclosures
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1 Property, 5 Foreclosure Sales, 5 Buyers Who Never Checked Public Records.

Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

Real story. Five separate occasions. Five different buyers. All bid on a foreclosure we held in second position in Florida, and every single one of them apparently had no idea we existed.

Let me be blunt: in Florida, the public records are online, searchable, and FREE. You do not need to order a title search to figure out the basic lien stack before you bid at a foreclosure auction. You can pull it yourself in 5 minutes. Mortgage recorded? It's there. Second position lien? Also there. Any liens that survives the sale? Guess what, also there.

Yet bidder after bidder showed up, bid and won the auction, and then had to realize there $5,000 - $10,000 deposit was gone (into my bank account) as they realized what they actually bought. 

I am not saying this to be cruel. I am saying this because it keeps happening and somebody has to say it out loud.

Before you bid on ANY foreclosure, especially in a public records state like Florida, you should at minimum be doing the following:

1. Pull the official records on the county clerk's website for the property address. Most Florida counties have this down to a science.

2. Look at every instrument recorded against that property, not just the one being foreclosed.

3. Understand which liens survive a foreclosure sale and which get wiped. (Hint: junior liens generally get wiped. Senior liens and certain government liens do NOT.)

4. If you are not sure what you are reading, either learn or pay someone who knows to review it before you bid a dollar.

I recommend a title search before bidding, but in Florida you can at least do basic due diligence on the lien stack with public records and save yourself from the most obvious disasters.

Five buyers. Five times. Same mistake. I could have kept going and collected more, but this last time around we finally had our attorney file with the courts that if it is a 5th default the property reverts to us. I am ok with that as I got my money from these idiots who donated to us and we will pay off the first as there is equity in the property.

Sorry for the rant but It literally blows my mind how people are incompetent and throw away thousands of dollars. 

Is anyone else seeing this occur out of curiosity? Can anyone explain the rationale?

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Stuart UdisPro Member
Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes
7mo

 I’d be curious to see the correlation between buyers who placed deposits and those who have taken weekend “guru” courses or actively follow real estate influencers. My assumption is that the overlap is fairly significant.

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  • Gina SternPro Member
    Investor · Boca Raton, FL · Member since 2019 · 1k+ posts · 161 votes
    7mo

    Good topic. Since we are deeply entrenched in the county foreclosure and tax deed auction business, we see people like this come through PropertyOnion by phone, email, and through our site all the time.

    This happens multiple times a day, every day, across counties all over Florida. An investor calls PropertyOnion for a title search after they have already paid for the winning bid. They ask for the title search, and when the results come back, the reaction is usually something like, "So I just lost all my money? How do I get a refund from the county?" Of course, we then have to explain the serious mistake they made. At that point, all we can really do is educate them on why title research has to be done before bidding, and try to point them toward doing title searches with us or taking one of the courses we offer so they can learn how to research title properly before they buy.

    I recently spoke with one investor who bought four properties in one week like this and basically lost $500,000. Their response was, "Oh well, you win some, you lose some." But most people are not that casual about it. Most are devastated. Some lose retirement savings, and some lose even more than that. We have a few documented cases of this on our site in our articles. I hesitate to post them here because of the forum rules, but it is really sad.

    In fact, blind bidding happens so often that it has become a money-making strategy for savvy investors who are comfortable operating in the grey area of the auction business.

    Here is how it works. A savvy grey area investor builds relationships with HOAs and condo associations that need revenue and offers to buy their liens at a discount. Or that same investor may identify junior mortgages they can buy at a discount. Now they are in a position to foreclose those liens and take them to auction, knowing that in almost any decent-sized county, there is a very good chance some newbie investor will come in, do no real due diligence, bid up the auction, and win.

    Once the auction closes, that lienholder investor ends up making a nice profit from the bid surplus.

    The investors who know how to do the research make good money. The ones who do not lose money by the fistful. The money is in the title research people, don't be lazy!

    [email protected]561-430-2616
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  • Vladimir Kovrizhnykh
    Real Estate Broker · Miami · Member since 2023 · 23 posts · 9 votes
    7mo

    We bid on county foreclosures in FL and we see this mistake made over and over again. 

    1Reply
  • Janice Carter
    Real Estate Broker · Atlanta · Member since 2024 · 1k+ posts · 608 votes
    7mo

    Chris, you are not wrong, it happens more than people admit. Most of it comes down to inexperience, auction hype and shortcut mentality. New investors assume foreclosure equals deal, they skip due diligence and don’t understand lien priority. Some also rely on incomplete data from auction sites or wholesalers and never verify public records themselves.

    Bottom line: it is not strategy but a lack of education and discipline. The ones who last in this space treat title and lien review as non-negotiable.

    0Reply
  • Chad U.
    Investor · Boca Raton, FL · Member since 2012 · 1k+ posts · 1k+ votes
    7mo

    Wow 5 times, that's absolutely insane. On two occasions I have purchased first liens where the HOA was already foreclosing on their lien. As opposed to paying it off I let both go right to the sale since they were both subject to the first (despite the servicer freaking out and claiming I'd lose the mortgage).

    In both cases a third party bidder far outbid the HOA judgment, and both realize their mistake after the fact. Surprisingly in one case (Ohio) the Sheriff allowed the bidder to walk and just lose their deposit, the other (Florida) not so lucky. For each we ended up paying cash for keys and getting a deed in lieu, for far less than we would have had to pay in foreclosure fees.

    0Reply
    • Chris SeveneyBusiness Member
      Moderator
      OP
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      7mo
      Quote from @Chad U.:

      Wow 5 times, that's absolutely insane. On two occasions I have purchased first liens where the HOA was already foreclosing on their lien. As opposed to paying it off I let both go right to the sale since they were both subject to the first (despite the servicer freaking out and claiming I'd lose the mortgage).

      In both cases a third party bidder far outbid the HOA judgment, and both realize their mistake after the fact. Surprisingly in one case (Ohio) the Sheriff allowed the bidder to walk and just lose their deposit, the other (Florida) not so lucky. For each we ended up paying cash for keys and getting a deed in lieu, for far less than we would have had to pay in foreclosure fees.


       I am closing on a loan right now that the subordinte lien holder foreclosed and thought he was in first position, so he is going to be in for a big surprise when he finds out he owes me 7 figures... But anyone who also thinks they can get a $1.6M home for $300k should be asking a lot more questions.

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    • Chad U.
      Investor · Boca Raton, FL · Member since 2012 · 1k+ posts · 1k+ votes
      7mo
      Quote from @Chris Seveney:
      Quote from @Chad U.:

      Wow 5 times, that's absolutely insane. On two occasions I have purchased first liens where the HOA was already foreclosing on their lien. As opposed to paying it off I let both go right to the sale since they were both subject to the first (despite the servicer freaking out and claiming I'd lose the mortgage).

      In both cases a third party bidder far outbid the HOA judgment, and both realize their mistake after the fact. Surprisingly in one case (Ohio) the Sheriff allowed the bidder to walk and just lose their deposit, the other (Florida) not so lucky. For each we ended up paying cash for keys and getting a deed in lieu, for far less than we would have had to pay in foreclosure fees.


       I am closing on a loan right now that the subordinte lien holder foreclosed and thought he was in first position, so he is going to be in for a big surprise when he finds out he owes me 7 figures... But anyone who also thinks they can get a $1.6M home for $300k should be asking a lot more questions.

      Ha nice!  I'm sure you got a great deal on it too as potential buyers panic when they see it's owned by another entity, and skip by.  I bought a 1st a couple years ago where the HOA had already foreclosed, so no one else bid on it and got it for a screaming deal.  
      0Reply
  • Stuart UdisPro Member
    Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes
    7mo

     I’d be curious to see the correlation between buyers who placed deposits and those who have taken weekend “guru” courses or actively follow real estate influencers. My assumption is that the overlap is fairly significant.

    [email protected]
    3Reply
  • Henry T.
    Member since 2022 · 1k+ posts · 1k+ votes
    7mo

    You can't do this in WA state. All liens are wiped.

    0Reply
    • Chad U.
      Investor · Boca Raton, FL · Member since 2012 · 1k+ posts · 1k+ votes
      7mo
      Quote from @Henry T.:

      You can't do this in WA state. All liens are wiped.


       Hmmm not sure about that.  Any proof of this, references to state statutes and/or caselaw to back this up?  

      0Reply
    • Chad U.
      Investor · Boca Raton, FL · Member since 2012 · 1k+ posts · 1k+ votes
      7mo
      Quote from @Chad U.:
      Quote from @Henry T.:

      You can't do this in WA state. All liens are wiped.


       Hmmm not sure about that.  Any proof of this, references to state statutes and/or caselaw to back this up?  

      Oh I recall now, the HOA can only foreclose for 6 months worth of HOA dues and wipe out the 1st if they don't pay prior to sale, but only for communities built after July 1, 2018 OR if written into their CC&R's. I has this situation once in Ohio, where the HOA demanded we owed them 10+ years worth of HOA dues after we foreclosed, but was only 6 months worth since their CC&R's prevailed. I recall not so nicely pointing this out to their Two-bit lawyer at the time.

      0Reply
  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    7mo

    Two words for those transacting real property without extensive experience, education, and local knowledge: legal counsel 

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    • Ken M.
      Investor · Get yourself trained before doing something inadvisable. · Member since 2024 · 3k+ posts · 1k+ votes
      4mo
      Quote from @Don Konipol:

      Two words for those transacting real property without extensive experience, education, and local knowledge: legal counsel 

      Your comment "legal counsel" 
      all too true


      1Reply
    • Simone Owens
      Specialist · Bristol, CT · Member since 2026 · 40 posts · 11 votes
      4mo

      @Don Konipol Completely agree, but for newer investors the challenge is that legal counsel before every auction bid isn’t always accessible or affordable at the volume they’re working. That’s exactly the gap I’ve seen, people who know they should be doing the research but don’t have the background to read what they find. The public records are free, the interpretation is where it breaks down.

      0Reply
  • Carson Nordmann
    Member since 2026 · 119 posts · 45 votes
    6mo

    The wild part is the surplus funds industry exists almost entirely because of this. Junior lienholders who didn't get paid attention to at sale show up later to claim against the registry. Free money on the table for whoever actually reads the file.

    0Reply
  • Simone Owens
    Specialist · Bristol, CT · Member since 2026 · 40 posts · 11 votes
    5mo

    This same pattern plays out at tax deed auctions across every state. The county sells the tax delinquency and bidders assume they are getting clean title. What they often get is IRS liens that survive the sale, environmental violations, properties assessed at 40% above actual market value, and redemption periods where the original owner can reclaim the property after you win.

    I have analyzed tax deed properties across Connecticut and the majority have at least one issue that changes the math on the deal. Most of it is visible in public records before you bid. Ownership history, lien status, assessed versus market value, flood zone designation. All public. All free. Most people just do not know where to look or how to read what they find.

    The money in this business goes to the people who do the research before the auction not after.

    0Reply
  • Simone Owens
    Specialist · Bristol, CT · Member since 2026 · 40 posts · 11 votes
    5mo

    This same pattern plays out at tax deed auctions across every state. The county sells the tax delinquency and bidders assume they are getting clean title. What they often get is IRS liens that survive the sale, environmental violations, properties assessed at 40% above actual market value, and redemption periods where the original owner can reclaim the property after you win.

    I have analyzed tax deed properties across Connecticut and the majority have at least one issue that changes the math on the deal. Most of it is visible in public records before you bid. Ownership history, lien status, assessed versus market value, flood zone designation. All public. All free. Most people just do not know where to look or how to read what they find.

    The money in this business goes to the people who do the research before the auction not after.

    0Reply
    • Pete Bigit
      Accountant · NY · Member since 2020 · 6 posts · 2 votes
      4mo

      @Simone Owens can you recommend the best tools to do this research? I'm new to foreclosures and interested in learning more

      1Reply
    • Simone Owens
      Specialist · Bristol, CT · Member since 2026 · 40 posts · 11 votes
      4mo

      0Reply
    • Simone Owens
      Specialist · Bristol, CT · Member since 2026 · 40 posts · 11 votes
      4mo
      Quote from @Pete Bigit:

      @Simone Owens can you recommend the best tools to do this research? I'm new to foreclosures and interested in learning more

      @Pete Bigit For free, start with your county clerk’s land records site. Pull every recorded instrument against the property, not just the one in the auction notice. For federal liens specifically, the IRS has its own lien filing system separate from county records — that one trips up a lot of people because bulk data providers don’t carry federal lien data well.

      If you want to skip the manual research, I built a report that pulls ownership history, lien status, assessed vs market value, and redemption status for CT tax deed and foreclosure properties — everything this thread is describing — in one document before you bid. Happy to run a free sample on a property you’re looking at so you can see what it catches.


      0Reply
    • Simone Owens
      Specialist · Bristol, CT · Member since 2026 · 40 posts · 11 votes
      4mo
      Quote from @Simone Owens:

      @Pete Bigit For free, start with your county clerk’s land records site. Pull every recorded instrument against the property, not just the one in the auction notice. For federal liens specifically, the IRS has its own lien filing system separate from county records — that one trips up a lot of people because bulk data providers don’t carry federal lien data well.

      If you want to skip the manual research, I built a report that pulls ownership history, lien status, assessed vs market value, and redemption status for CT tax deed and foreclosure properties — everything this thread is describing — in one document before you bid. Happy to run a free sample on a property you’re looking at so you can see what it catches.



      0Reply
  • Sandra Duerksen
    Member since 2023 · 1 post · 0 votes
    4mo
    Is there a similar as in Property Onion where I might find these types potential investments in the state of Washington?
    0Reply
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