Overturned Foreclosure Sale?

9 Replies

Hi, I was just a bidder, and I am wondering what are the chances that this foreclosure sale gets rescinded in California.  The auction starts as normal.  The last bid is 100k over opening bid before the auctioneer gets a phone call to stop in the middle.  2 minutes later she gets another call and says it is postponed.   She says you are welcome to stay to get new date.  6 out of 7 leave since we know the drill and common postponements.  Turns out, auctioneer calls trustee again and they say go ahead with sale.  They start auction back at opening bid and the 1 person gets it for 100k less than the last bid.  There are multiple junior liens that would be in line to collect the excess funds they would have gotten in a proper auction.

Sounds like a lesson in why you stay for the whole auction.  was that lucky bidder you?

No i was not the lucky person.  I guess there is a lesson in there.   When i was newer to buying foreclosures i may have stuck around just to see;  this house has been in default for 20 months so postponement felt normal.   I do have some hope that it gets rescinded.  They post the results on a website and usually that is there for a few weeks; this time they posted the sale and then took the listing off the website completely.  I feel like this was an egregious error in the process.

Sounds like a shut out . Like in the movie  " the sting "  A regular buyer , or friend of auctioneer  wanted the property , auctioneer fakes a phone call , tells people sale is off , they leave , all of the sudden phone rings again and its back on and the only person left is the friend . 

Just to close this out; I am not sure how it all played out but new notice of sale is out so they must have rescinded the sale.  

Originally posted by @Matt Pfefferlen :

Just to close this out; I am not sure how it all played out but new notice of sale is out so they must have rescinded the sale.  

 Crisis averted...

The latest here is that the sale is scheduled still but the party (big company with in house lawyers) that won the bid and had it rescinded has filed a lawsuit so there is a lis pendens filed against property.   I am interested in bidding still although at a lower price given potential clouded title.  Does anyone know how this could play out in court if in fact i do win the house at auction?

I doubt the rescheduled sale actually takes place now that there is a lawsuit pending.

More likely there will be an expedited litigation schedule and then, if the last buyer loses, the sale occurs.

This is one reason you might see the junior lien holders recording auctions.

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