Auctions & Sheriff Sale

The most common way to purchasing REO properties is to attend the foreclosure auction or sheriff’s sale and make bids on available properties.
If the auction bids do not satisfy the lender’s minimum requirements the property is not sold. Instead, the property is retained by the lender, which then tries to sell it through a real estate broker. You can then make offers through the real estate broker. In some cases, the lender may skip the auction altogether.
As you will soon find out, you will not be the only person with the notion of finding a bargain on the foreclosure market. Before you begin bidding, you should already have established what the property is probably worth and how much you are willing to pay for it. To establish its market value, you will need to consult a good, but inexpensive appraiser or a real estate agent with experience in the area.
When purchasing foreclosure properties, the wise investor should NEVER pay market price. If you are willing to pay market value, you might as well buy a house through an agent, who will obtain helpful disclosures and warranties for you. When you buy a foreclosure property, you buy it as is—any hidden problems are normally your problems, not the seller.