By Tim Jones of Foreclosure.com, featuring insights from Ashley Pickens, Broker and Auctioneer.
When most people think about buying a home, they picture scrolling through Zillow or driving around neighborhoods with a real estate agent. But there’s another side of the housing market where properties sell at a fraction of their value — foreclosure auctions.
To understand how these auctions work and how everyday buyers and investors can benefit from them, I sat down with Ashley Pickens, a Memphis-based broker, licensed auctioneer, and multi-million-dollar real estate producer. Ashley has nearly two decades of experience in real estate, and she’s helped countless buyers navigate the challenging world of foreclosure auctions.
A foreclosure auction occurs when a homeowner defaults on their mortgage, and the lender repossesses the property. Instead of letting the home sit vacant, the bank auctions it off to recover what they’re owed.
Ashley explains:
"A foreclosure auction is the final step in the foreclosure process. The bank wants to recover their money quickly, so they put the property up for public sale. This is where investors — and sometimes even first-time buyers — can find deals you’ll never see on the MLS."
Unlike traditional listings, foreclosure auctions typically sell as-is and require buyers to pay promptly, often on the same day. That can sound intimidating, but with preparation, the risks can be managed.
Most beginners are unaware of where auctions are listed. According to Ashley, that’s the first hurdle.
"If you’re in Tennessee, you’ll see notices in the local newspaper because that’s required by law. But the easiest way for most people is to use an online platform like Foreclosure.com. That’s where I send my clients who are looking for deals before they even hit the auction."
Foreclosure.com aggregates foreclosures, pre-foreclosures, and auction properties nationwide, saving buyers hours of research.
"I always tell people - don’t just wait for the courthouse steps. Start tracking properties online early. That way you’ll know what’s coming up, and you can actually do your homework before the auction day."
Walking into an auction without preparation is a recipe for disaster. Ashley stressed that the most important step is research.
"Do your homework before you bid. Go see the property if you can, check the title for liens, and figure out what repairs it will need. I’ve seen so many people overpay just because they got caught up in the excitement."
In addition to research, buyers need to be financially ready. Most auctions require payment in cash or by cashier’s check on the day of the sale.
"You can’t use a traditional mortgage at the auction itself. That means you need liquid funds or hard money financing ready to go. If you’re not prepared, you’ll miss your chance."
Foreclosure auctions can be profitable, but they’re not without risks. Ashley pointed out some of the biggest mistakes she sees beginners make:
Today, an increasing number of foreclosure auctions are moving online. Ashley has seen both sides and shared the pros and cons.
"Online auctions are convenient — you can bid from anywhere. But you also lose the ability to read the room. In-person, you can see who’s serious and who’s just testing the waters."
She notes that online auctions tend to attract a larger pool of bidders, which can drive prices higher. Still, for many buyers, the accessibility outweighs the competition.
"I tell my clients, if you’re just starting out, online auctions are a great way to watch and learn. You can even follow auctions without bidding to get a feel for the process."
With mortgage rates high and inventory low, buyers are struggling to find affordable homes. That’s why foreclosure auctions are attracting more attention.
Ashley believes this trend will only grow:
"We’re already seeing an uptick in pre-foreclosures, especially after the pandemic protections ended. That means more properties will be coming to auction in the next few years. If you learn this process now, you’ll be ahead of the curve."
She emphasized that auctions aren’t just for seasoned investors. First-time home buyers can benefit too, as long as they’re willing to do the legwork.
"I’ve helped families buy their first home at auction. They got a great deal, put in some sweat equity, and ended up with instant equity. It can be life-changing if you do it right."
When asked what single piece of advice she’d give someone considering their first foreclosure auction, Ashley didn't hesitate:
"Get educated before you get emotional. The people who win at auctions aren’t the ones who bid the fastest — they’re the ones who came prepared."
For buyers ready to test the waters, Ashley recommends starting small.
"Pick one property and research it like crazy, even if you don’t bid. Go through the motions — check the title, look at the neighborhood, set your budget. Then watch the auction and see what happens. That practice alone will put you miles ahead of the average bidder."
And, of course, she stresses the importance of using the right tools.
"Foreclosure.com is hands-down the best place to start. I’ve used it myself for years, and it gives you access to pre foreclosures, auctions, and bank-owned homes all in one place. You can’t beat that."
Foreclosure auctions can feel intimidating at first, but with the right preparation and guidance, they’re one of the best ways to find real estate deals that never make it to the open market.
As Ashley put it best:
"Auctions are where you find opportunity. The key is knowing how to spot it before everyone else does."
Whether you’re an investor hunting for your next flip or a first-time buyer searching for an affordable home, foreclosure auctions might just be the hidden path to your next property.
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