Foreclosure Upset Bid Refund – How Do You Get It?

Foreclosure Upset Bid Refund - how do you get it?

Have you ever bid at the courthouse on a foreclosed property? Was yours the original bid or was it an upset bid?

What is an “upset bid”?

At a foreclosure auction at the courthouse, once a highest bidder is determined, there is a 10 day period during which North Carolina allows someone willing to pay more to place a higher bid. They must raise the accepted bid by a minimum of 5% and include a cash deposit of 5% of their bid price.

If you are outbid or your bid is “upset”, the process begins again and another higher bidder has 10 days to make a better offer. If, after the 10 day upset period expires there are no higher bids, the person who placed the last highest bid wins the right to purchase for their bid price if it has been accepted by the seller.

North Carolina Statue requires that an upset bid be received within 10 days after the date the notice of auction sale is published. To qualify as an upset bid, the bid must raise the published offer by an amount of at least 10% of the first thousand dollars of the offer and 5% of the remainder of the published offer. When a bid has been successfully raised (upset), the highest new bid becomes the current offer and the procedure is repeated.

Did you make a bid at the courthouse and lose? How do you get your deposit refund?

I went through a number of phones calls to a number of Guilford County offices and ended at Special Proceedings. They do not send refunds automatically. Many people keep bidding and don’t want their refund until the very end.

Whenever you decide to get your refund, if you did not have the highest bid, take your receipt to the Special Proceedings office and, usually, your check will be mailed to you the next day.

Easy. But they wait for you to bring them the receipt. What are you waiting for?

This post has 53 Comments | Would you like to leave a comment?


  1. Jinal:
    Since you won the bid, I don’t believe there is any way out. And, you will lose your entire deposit.

    From what I understand, the lender can also ask the court for their resale expenses to cover the costs of their loss from the original sale. So, you may owe the deposit plus 5%.

    If you decide that you can’t or no longer want to close on the deal, contact the trustee who represented the lender in this sale to see if any refund can be worked out and about an extension.

    A few strong negatives working with foreclosure bids are that (1) your deposit is at risk, unless you’re outbid (2) often you can’t inspect before purchase (3) you must have funds lined up because you must close within 30 days or you’re in default.

    I’m not an attorney so check with the trustee and a real estate attorney to be sure. And, if you now believe you would lose more than $22,000 to purchase this property, walking away could still be a savings to you and the education well worth it in the end.

    Foreclosure sales are tough. Please let us know how this turns out and thank you for asking.

  2. Hi Karen. I am in nc. We won the bid on foreclosed property but now we want to back out. Is there anyway out from this? Also if we do loose money, it will be up to 5 percent of our deposit? Would we be liable for anything more than that?

    Also are we able to get an extension for our closing date? Which is month from the date we won.

  3. Hi Marsha: I was talking with an attorney about something similar yesterday. From our conversation, I believe this is perfectly legal. The property is for sale, the attorney is an able and willing buyer.

    However, as I’ve said before, I am not an attorney and I am not giving legal advice. You must contact an attorney on your own behalf to obtain legal information. Feel free to go online to LegalZoom or some of the other free sources as a great start.

    Good luck to you!

  4. Thanks Karen!
    I have one more new question. In NC can an attorney for a town who has signed and placed a lien on a lot for the town for unpaid taxes become an upset bidder for his own personal interests in the upset bid process for a foreclosure on that same property? Or is this a conflict of interest because he found out about the foreclosure due to his position as the town’s attorney? could you please ask the foreclosure attorney in your county if that would be allowed or not? It would be SO helpful?

  5. Hi again, Marsha:
    I’ve called a number of people at our local courthouse and most of the answers I received were – “your attorney handles this; you must ask your attorney.”
    So, again, here’s what I know from our experience:
    1. Upset bids are allowed for 10 days following the auction – an extra day if the 10th day is a government recognized holiday or Sunday.
    2. Tax lien auctions are for the amount of the unpaid taxes plus interest plus selling costs and that is where the bid starts. 30 days to pay but, again, up to the attorney handling it.
    3. If high bidder does not perform, a new auction is scheduled. When and how is apparently up to the attorney handling the case. There are attorneys who specialize in these proceedings. The response I consistently received from the courthouse was, “give me your case number and I can answer your question.” Which indicates there is some standard process as well as some flexibility.

    This answer is about as clear as mud, but I hope it helps and let me know what you find with any property you pursue this way! Thanks for your questions and for adding to this conversation!

  6. Karen, my Question concerns NC law. What would be your answers in light of that?

  7. Reply to Marsha..

    1. Yes. If the 10th day falls on a holiday, the it is extended to the next business day.
    2. Some Trustees are flexible up to a week. I have gone 35 days before closing. You need to “convince” the trustee that you will close within the extended period.
    3. No, it doe not go to the next highest bidder. The trustee starts the process again. The high bidder who did not close may not get the deposit back and also may be liable for more than the deposit in some cases.

  8. Hi Marsha:
    Check with your courthouse for definite answers as this process can vary by state. As a matter of fact, not every state has an upset bid period.

    Typically it is 10 days (starting the day after the foreclosure sale) – not just business days. If day 10 is on a weekend or holiday, you have until the end of the next business day to file a new upset bid.

    Again, check with your courthouse to determine rules for your state.

  9. Karen, thanks for the outstanding job you do!
    1. If the tenth day of the upset bid process falls on a Sunday or holiday is it extended to the next business day?
    2. In an auction the county has due to unpaid taxes on a piece of land here are my ?s:
    A. How long does the upset bid winner have to pay? Is it a strict 30 days? does the county attorney have the right to change or be flexible with the deadline?
    B. If the winning upset bidder does not meet the deadline in a sale because of unpaid taxes will the sale go to the next highest bidder or does the land go back up for auction?

  10. Thanks for the info. If anyone tries this site, please let us know how it works out.


  11. if you are in Wake county, try this site You need to subscribe for a fee. Site provides up-to-date info about upcoming sales, completed sales and upset bids etc. It is worth it if you are an investor and does not mind the subscription fee. I believe they also have info for Guilford county.

  12. Hi Elliott:
    That totally depends upon the courthouse and how well they upload current information. The best thing to do is call the courthouse to gain information. Each will be different. Some will give you info over the phone because they have the time to do that. Some you’ll need to go in to look up current info.

    If you find a site, please let us know, but all the online services pull their information from county sites and are at the mercy of how technologically advanced and up to date those counties are.

  13. Are there any online sites that tell you whether a property which was scheduled for auction was: 1) cancelled; 2) sold & at what price; 3) if sold, the current status of any upset bids on the property ?

    All the online sites I look at are rather limited – some like Hubzu and only show their proprietary properties and very little followup informaton.

  14. Awesome information! Truthful honest information! Thanks,

  15. You can search public records at the courthouse.

    Or see if you can get a para legal to search for you for $50-$100.

    Good luck!

  16. Hi Karen,
    As I am not sure I am gonna win the trustee sale auction, I don’t want to spend money on a title search conducted by an attorney (they want $200+ for that…).
    Are there any measures I can take by myself and search for any mortgages, liens, judgements etc.? After all, all should be public records available at the court either online or manual, right?

  17. Hi Esther:

    Here are the comments you’re referring to:
    If a bidder is unable to close on the purchase from a foreclosure auction, they forfeit their deposit.
The next highest bidder is then in line for purchase, if accepted by the seller.

If the loan falls through, the house is put back out for auction.
 Of the deposit, you should receive 100% refund if you are outbid.

    Joe is talking about a bidder who is unable to close on their loan. They forfeit their deposit. Harold is asking two questions, the second one about a bidder who is outbid. If they are outbid and therefore don’t get the house, they get 100% of their deposit back.

  18. I don’t understand your answer April 1st at 5:01 pm to Harold and March 21st at 8:43 am to Joe. They seemed to be asking the same question and your answers seemed different. Please help me understand.

  19. Hi Mark:

    Clerk of Superior Courts office.

  20. Exactly where in the courthouse would an individual go to upset a bid?

  21. Hi Joe:

    If a bidder is unable to close on the purchase from a foreclosure auction, they forfeit their deposit.
    The next highest bidder is then in line for purchase, if accepted by the seller.

    Good luck!

  22. What are the remedies or limits of remedies available to the trustee if the winning bid is unable to close.? In other words. Unable to perform the purchase.

  23. Hi Sydney:
    Typically, it’s the trustee who’s handling the property that you contact about that. They should know whether or not the home is included in the bankruptcy because, no, it’s not always included. In fact, if the property is sold or under contract, the seller can omit it from the bankruptcy or even have it taken out of the bankruptcy at a later date.

    Try reaching out to the trustee again. If they’re not the one to help, they should be able to direct you to the one who is.

  24. We are wanting to bid on a foreclosed property in Johnston County. There was an initial bid and we would like to place an upset bid in the next 5 days. However, when trying to find information out about the property, we called the trustee. They notified us that the owner of the home has filed bankruptcy…does this typically mean that the property is no longer being foreclosed on? Who should we contact to see if we are still able to obtain this property in any way. Thanks!

  25. Hi Kenny:
    The answer may be state specific so contact the courthouse and ask for the process. Often times a buyer turns out to be unable to close on a property and it ends up going back to auction or the bank takes it back as an REO. However, my concern is whether or not your deposit is refundable.

    Please check and let us know here what you find out.

  26. Hello, can I pull out of an auction? I’ve deposited 17,000 usd and Ive decided not to go for it. Currently, I am the highest bidder. Is there any way to get out of this? Thanks

  27. HaGo:
    You don’t have legal permission to do anything with the property (or the tenant) until title changes because, until then, you are not the owner. How long this takes depends upon how backed up the court system is. I suggest calling the county and asking where you are in the process.

    Congratulations on your new purchase!

  28. Just from you “experience” in Guilford County (Greensboro) if my bid is “not” upset, can I proceed with a 10 notice to quit (eviction notice) to the current tenants, or must I “absolutely wait” for the title to affirm in my name before I give or post notice to vacate. How long does this take, or for this purpose is it assumed I have title since my bid stood?

    P.S Great thread!

  29. Thank you very much for your help, Karen

  30. Every state is different, LangLe. Ask your attorney.

    Let us know if you get it!

  31. I am very confused about the minimum start bid amount. Who establish this number ? I thought that who ever running the auction (trustee) must get this number from the bank before the auction. If this is the case, then why the bank set the starting price so low ? Why don’t they set the price at the mortgage balance ?

  32. The bank may outbid you and put it on the retail market for sale with a real estate agent. Decide how much you can afford to bid for it and don’t go over that.

  33. I have the attorney do the title search on the house, it shows that my winning bid is well below the mortgage principal. Any chance that the bank will not approve the sale?

  34. The trustee will make sure the sale price is enough to cover any bank loan.

  35. If the auction is a trustee sales then does it need to get the bank approval too ?

  36. Hi LangLe:

    You can go to the courthouse everyday to check, or you can just wait until the 9th day to go see if you need to place another higher bid.

    Thanks for asking!

  37. I am the highest bidder and now the house is in 10days outbid period, How do I know if someone coming and submit an upset during this period

  38. Hi Anita:

    The forms change from time to time and every county is different. However, all you need to do is contact the appropriate county court house and they will not only tell you what you need, they should have the forms available there. Or, your real estate attorney will have them for you.

    Good luck to you and please let us know if you win the bid!

  39. What form is used for an upset bid in NC as a purchase agreement or contract? I have the other forms to submit payment, etc, but cannot find the “contract form” online anywhere. Can you advise?

    I am trying to pull all documentation together before I go to courthouse.

  40. Hello Pradeep:

    Check your county laws but, typically when there is an upset bid, it starts the clock again and there is another 10 days allowed for additional upset bids. You will be required to put down more money with your upset. The amount you need to put down with your bid depends upon the amount of your bid.

    They should be able to answer all of your questions at the courthouse where the bidding takes place.

    Thanks for asking!

  41. I won a bid but someone has upset my bid, how do i upset the bid again as i only have 1 working day left, thanks.

  42. If you win the upset bid and there is no more upset time allowed, most lenders allow you up to 30 days to secure your financing. Yes, you can pay sooner if you’re able. I’m sure the title holder would like that!

    Thanks for asking, Tim.

  43. If I win an upset bid, it states above you typically have 30 days to close. Why typically? Could it be shorter than 30 days?

  44. Yes, Paul, as the winning bidder you would then be responsible for any liens on the property. Not all foreclosed properties come with a clean title.

    Before bidding, it may be worth your while to pay an attorney to run a title search.

    Thanks for asking!

    Please let me know what you find out.

  45. As the winning bidder at the court house am I then responsible if there are any leans on the property. Is there a chance I could end up paying more than the price I bid? Is a clean title guaranteed? What sort of research should I do prior to auction day? Thanks.

  46. As the winner of the bid, don’t count on a refund. You should never bid without the funds to close. You signed a contract to perform. Just be grateful if all they require is your deposit.

    Keep us posted and thanks for the update.

  47. Thanks. My concern now is that I have the highest bid and it has closed out. My loan isn’t a sure thing. Is it likely that the Trustees or for that matter, the County would refund the deposit?

  48. Hi Harold:
    If the loan falls through, the house is put back out for auction.
    Of the deposit, you should receive 100% refund if you are outbid.

    To your success!

  49. And if the loan fails to come through, does the sale revert to the other bidder? Does this call for another auction? Of the deposit, how much would one lose?

  50. Al: Depends upon the type of auction. At the courthouse, if you’re the high bidder, there is a 10 day “upset” bid period where another person can come along and outbid you. After that, you typically have 30 days to close.
    At a private auction or anything other than the courthouse, you are usually given up to 30 days to close. If you have cash, you can close sooner.

  51. At an auction of property, how long would it take for the winning bidder to obtain
    title to the property?

  52. When you bid at the courthouse, you don’t know for sure until you hear back from the bank! This usually takes only a matter of days.

    If your bid is accepted, there is then an upset bid period where other bidders are given an opportunity to bid higher than you did so you need to pay attention.

  53. How do you know if the bid will be accepted buy the seller?

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