Fake Bidders at Auctions??

Looking to hear from some experienced investors that have a good backround at forclouser sales at the county court house.

I attended a forclouser auction at the county court house last week and there were 15-20 people bidding on a property. However, I noticed a small group of them talking together about only one person bidding for the property and the others were paid a 500-1000 dollars not to bid. This was done obviously to keep the price down. My question is??

Thanks in advance.


Is this common place? Are there people that actually attend these auctions, appearing like they are interested in bidding but are really not serious on getting the property, just in hopes of making a few bucks by giving an impression that they are serious and could kick up the price of the property but will not if paid to keep quite??

The practice you are talking about is bid rigging and is illegal. It does happen though.

Bob Diamond

Yes it Does!!:>)

Every few years up here in Philadelphia the US Attorneys office rounds up the culprits and arrests them for bid rigging. It is probably similar by you. Don’t get involved with them and just go and bid - or better yet buy before the auction at the pre-foreclosure stage. That is by far where the best deals are and you don’t have to worry about the nonsense that goes on at the auctions (including the idiot with a large credit line and no real estate knowlege).

Good luck!

Bob Diamond

Yes Bob is correct. They are essentially tampering with a legalized process - bad news all around.

If you’re talking about mortgage foreclosure auctions, I agree with Bob in the sense that you should try to buy the property before it hits the courthouse steps. If you’re speaking of tax sale auctions, you basically have to bid with everyone else - however, some states/counties allow you to purchase tax sale property through the mail or “over the counter” in which there is no competition.

Tax Lien Queen

In our area the tax sale properties are offered after the regular voice auction. Sometimes there can be some good deals in there.

I’m a realtor who works for Alex Cooper Auctioneers in Towson, Maryland. Cooper is my broker. I will tell you from an insiders perspective that this does not happen at Cooper. Or, at least, I’ve never seen it. If it did, I would be putting my license in jeopardy and I wouldn’t work there. Find out who the reputable auctioneers are. Those that have been in business for a long time (Cooper since 1927) have done so by being above board.

Now I am confuse.

So what if there are 50 people in the court house, as long as no one is bidding on the property that you are bidding on. Price will remain low. Its an open bid auction correct? And you will know exactly how much you need to bid and not a cent more. Know your ceiling will eliminate all the BS. Its not like HUD where you have seal bids.


If the deposit is listed as $17,000 it is a dead giveaway that the bank wants the bidding started at $170,000 to recoup what is owed to them. By the time the sale gets to the courthouse steps, there is no way the bank is going to let the house go for less than what the owner owes. They will have a representative there to bid the house up. They would rather wind up taking it as an REO and having an agent MLS it then accept less than what is owed.