Foreclosure properties: How to find real bargains

Foreclosed real estate is an attractive way to buy a house or apartment below the market price. But before you get involved, you should understand the process and its specifics in detail. In this article, you'll learn step by step how to find real estate from foreclosure sales, what to look out for and what pitfalls can lurk.

1. What is a foreclosure auction?

A foreclosure auction is a legal process in which a property is forcibly sold in order to satisfy the claims of creditors (e.g. banks). This often happens when the owner is no longer able to pay off their mortgage debts. The procedure is initiated by the competent enforcement or bankruptcy office and follows

legal requirements.

Foreclosures often offer low prices — but there are risks that you should be aware of.

2. Why are foreclosures often cheaper?

Not every property is sold far below market value, but good opportunities often arise. The main reasons for this are:

Owners and creditors are under time pressure to sell the property.
The market value is determined by an expert opinion, which creates a transparent price base.
Demand is often lower than on the open market, as many buyers shy away from the auction process.

In many cases, real estate is auctioned off at 10-30% lower than its regular market value. However, the final price depends heavily on location, condition and demand.

3. Where can foreclosures be found?

Foreclosures are not marketed centrally via real estate platforms, but are published via the following sources:

Debt collection and bankruptcy offices: The official publications can be viewed online or in official journals.
Online portals: Specialized websites aggregate information on upcoming auctions.
Brokers: Some brokers offer targeted advice and access to such properties.
Banks and creditors: These sometimes provide information about upcoming auctions.

4. Procedure of a foreclosure auction

Here is an overview of the most important steps of an auction:

Step
description
1. Gather information	View the report, market value and auction date.
2. Check object	If possible, visit on site or talk to neighbors.
3. Clarify financing	Coordinate credit limits with the bank, as 10% security is required.
4. auction date	Show up with a valid ID and security deposit.
5. Bidding process	Bids are submitted within a fixed period of time.
6. supplement	The highest bidder is awarded the contract under certain conditions.
7. Transfer of ownership	After payment of the purchase price, the land register entry is made.

5. Important aspects of a foreclosure auction

5.1 Review the report carefully

The court report includes important details such as:

Condition of the property
Renovation needs
size of the plot and living space
Possible charges (e.g. rental rights, easements)

Since visits are often not possible, the report should be analysed in detail and, if necessary, an expert should be consulted.

5.2 Financing and Bidding Security

Most auctions require a security deposit of 10% of the market value. This can be deposited by bank guarantee or check.

Important: After the bid, the purchase price must be paid within a fixed period of time.

5.3 Potential risks

No warranty: The property will be auctioned “as is.”
Tenancy rights: Existing tenancies often persist.
Hidden costs: Renovation, legacy or ongoing costs can be expensive.

6. Tips for successful bidding

Set yourself a clear budget — emotional bidding matches can be expensive.

Set a budget: Define a clear pain threshold.
Gain experience: Visit previous auctions as a spectator.
Stay calm: Don't be unsettled by bidding competition.
Legal advice: Consult experts before making major purchases.

7. Conclusion

Foreclosures offer opportunities but require thorough preparation. Anyone who knows the process, analyses the report and has a solid financing strategy can make a good deal.

Remember: A low purchase price alone does not make a good deal — location, condition and follow-up costs are decisive.