Can I Get a Mortgage for a Property I Bid On? 

Important terms to know:


A sale in which properties are bid on and are sold to the winning bidder. Auctions can take place in person, at a local courthouse or online.  


Most properties that are included in online or in-person auctions are cash only, meaning that the seller will only take cash as payment for the property.  

However, on occasion, a property in an auction event will be listed as financeable, finance eligible, or labeled that financing is available. These properties can be financed through a traditional mortgage or a specialty loan, such as an investor credit facility, and be paid for over a period of time.   


What kinds of financing are available for these properties?

Traditional mortgage

A loan provided by a lending institution such as a bank that usually requires things like a down payment from the buyer that’s 3-20% of the sales price, an appraisal and inspection of the property, and that the buyer has a good credit score.  Traditional finance options include fixed-rate, adjustable-rate, conforming (FHFA), non-conforming, and government-issued (FHA, USDA, VA) loans.   

Specialty loan

This type of loan is also known as an investor credit facility, hard money, fix and flip, or bridge loan.  Cash is paid directly from a third-party lender to the seller. The seller receives payment in full for the property at closing. These types of loans often don’t include any appraisal or inspection requirements or for the buyer to provide a down payment. 
However, the buyer must have a solid credit score and the ability to pay back the loan to the third-party lender, typically within 3 to 12 months. Specialty loans also typically have higher interest rates.   


If you’re planning to purchase a property through one of these financing options, we highly recommend doing your research ahead of time to determine which strategy is the right fit for you.  

Whatever you choose, be sure to check all the requirements for financing an auction property to make sure you have all the documentation you need ready in case you win the auction!        



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