Understanding foreclosure auctions — step by step

Bidding at a compulsory auction for the first time? This guide walks you step by step through everything – from finding a property to financing, the security deposit and the award.

At a compulsory auction you buy with no warranty and often without an interior inspection. What to check in the appraisal, the land register and the occupancy before you bid.

The court only checks the 10% deposit, not your creditworthiness. Your bank sets your real bid limit. Here's how financing works and what default risks.

If you want to bid at a compulsory auction, you usually have to lodge 10% of the market value as security in advance, and not in cash. Here is how it works.

If you bid for someone else – even your spouse – you need a publicly certified bidding authorisation. Without it at the hearing, your bid is rejected.

ZVG Melder explains how an auction hearing runs: the call, the lowest admissible bid, at least 30 minutes of bidding time, the ID requirement – and why the award grants ownership at once.

Below 50%, the award is refused ex officio at the first hearing; between 50 and 70% only on a creditor's motion. At the second hearing, both thresholds fall away.

With the award you become owner – but the cash bid soon falls due (plus 4% interest), and you take on tenants, surviving rights and outstanding service charges.

The auction procedure is identical nationwide – the one major difference is the real estate transfer tax (3.5% to 6.5%). Here are all 16 rates and what else varies.

ZVG Melder detects risk findings from official appraisals, structures them into classes and shows how strong the data basis is.