Lessons from My First Foreclosure Auction

On Tuesday of this week I was lucky enough to be able to attend a foreclosure auction on the courthouse steps. Actually, I had enough time to maker two auctions: Cherokee and Dekalb.

For those of you who don’t know, every state has different foreclosure proceedings and the state of Georgia has its foreclosure auction on the first Tuesday of every month. They are located on the steps of the county courthouse in the county where the mortgaged property is located.

So, I was there on Tuesday participating in these auctions. Here is what I noticed:

There are good attorneys and . . . less good attorneys.

Most of the people reading out the legal descriptions and conducting the auctions are attorneys employed by the lender. Some of them are patient, articulate, and conducive to a great auction. Others mumble, are impatient, and just want to leave. The good ones tend to get higher prices. The bad ones just annoy everyone.


Most of the buyers that have success are institutional.

You can tell after about 2 minutes that most of the major bidders are large equity funds from out of state. They put down their cell phone numbers when they win a bid, and you see mostly LA and NYC area codes. That would be discouraging to me if I were a small town, local bidder.


Most of the work happens before the auction.

All you get from the attorney is the legal description of the property, its address, a description of the mortgage, and some legal jargon about the nature of the auction. You have to know a ton about the property before you ever step foot on the courthouse steps. Otherwise you will have no idea what you are bidding on or what is a fair price. You may have thought this auction was a single day of work. No sir. It’s weeks of homework and research.


There is a price-ceiling for most buyers.

I didn’t hear much action above a certain level. That price “ceiling” is different for every county, but once you go above it there are zero bidders. For example, let’s say the ceiling is $300,000 in Forsyth County. If the lender has an opening bid of $350,000 on the property, I would anticipate ZERO competing bids. Maybe the ceiling is $350k or $200k in Fulton. I don’t know. What I do know is that there is a ceiling in every county and it would be interesting to analyze what those numbers are . . .


Many of the bidders have rules.

After the first bid, you will figure out that many of the institutional bidders have limits and thresholds to what they are permitted to do. Some are only allowed to increase the bid $100 at a time and ALL of them have specified max bids that they aren’t allowed exceed. It’s actually kinda annoying, but if you can figure out who they are and what rules they have to follow, you can probably run circles around them.



Quite an interesting process. It’s incredibly inefficient and confusing, especially compared to Florida (who uses an online auction like eBay), but it is certainly interesting.

If you ever go, drop me an email at Duke(at) and I will give you a few tips that I can’t share with the world right now. I am always happy to help (as long as you aren’t bidding against me!).

Happy hunting!

– Duke

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