Even if the winning bid sells third party (to someone other than the borrower and the bank), the bid still has to be approved by the bank in the end. So, there is always a chance that even though you walk away from the auction the highest bidder, the bank could still reject your bid. This happens in instances where the bank may not have placed a full credit bid (a bid less than the amount owed). Also, keep in mind that you need cash in hand at these auctions. In a few instances (usually advertised before hand) you can pay within 30 days of the sale as long as a certain percentage is put down as a nonrefundable deposit, but in general, you need to show up with a cashier’s check. There’s also always the chance that the foreclosure sale could be recinded and you could no longer own the home as well…this sometimes happens if the borrower files bankruptsy the day (or a few days) before the sale and the bank is unaware.
