Wholesaling Auction Properties: The (Ultimate) Guide

Real estate wholesaling auction properties can be a cost-effective way to build a real estate investment portfolio. Many of the properties offered for auction are homes facing foreclosure or otherwise distressed. Often, these homes can be purchased below market value.

In this article, you’ll learn how real estate auctions work, where to find auction properties for wholesale deals, and how to wholesale real estate auction properties.

• What Are Auction Properties?
• Can I Wholesale An Auction House?
• How To Wholesale Auction Properties: Step By Step
• How Do You Find Auction Properties To Wholesale?
• Wholesaling Houses From An Online Auction
• Where Can You Purchase Online Auction Houses?
• Wholesaling Auction Properties FAQ
• Final Thoughts

What Are Auction Properties?

Auction properties are homes or other real estate offered to the public through a live or online bidding event with set rules, deadlines, and closing terms. For investors focused on wholesaling auction properties, auctions can provide transparent pricing, firm timelines, and a steady stream of opportunities within the broader world of real estate investing.

Why properties go to auction: The most common triggers are foreclosure and tax liens, but not every auction home is distressed—many are typical sellers seeking speed or certainty. Learn more about what qualifies as distressed properties (and what does not).

• Judicial foreclosure (Sheriff’s Sale): Court-ordered sales driven by foreclosure or judgments. A sheriff's sale is a common format.
• Non-judicial foreclosure (Trustee’s Sale): In some states, a trustee conducts the foreclosure auction under a deed of trust.
• Lender auctions: Banks auction properties to satisfy unpaid mortgage balances. If a property does not sell, it often becomes REO (real-estate owned) and may later be re-auctioned or listed on the MLS.
• Tax lien / tax deed sales: Local governments auction properties when owners fall far behind on taxes—an avenue related to tax lien investing.
• Owner, builder, or luxury auctions: Sellers use auctions to accelerate a sale, reach a wider buyer pool, or avoid lengthy market times—these are not necessarily distressed.

What to expect at an auction:

• Terms are preset: You bid “as-is,” acknowledge any buyer’s premium, and accept the required deposit and closing deadline (often 7–30 days).
• Due diligence is limited: Access for inspections can be restricted; title, occupancy, and redemption rules vary by state and auction.
• If the property doesn’t sell: It may revert to the lender as REO and be sold later via another auction or the MLS.

Can I Wholesale An Auction House?

Yes. You can wholesale houses found at auctions—in person or online—as long as the auction’s terms allow it and you plan your funding and timeline correctly. For investors focused on wholesaling auction properties, the big levers are: assignment rules, deposit requirements, closing deadlines, and title/redemption risks.

In-person vs. online auctions (what changes for wholesalers):

• In-person auctions: Commonly require full payment (cash/cashier’s check) the same day. That makes assignments harder and often pushes wholesalers toward a same-day/double close.
• Online auctions: Typically start with a bid deposit and then an escrow payment if you win. You’ll usually have a short window—sometimes as little as 7–10 days—to fund the full purchase price.

For real estate investors, wholesaling is appealing because it can turn deals quickly compared to flipping houses or rentals and often requires less cash up front. The wholesaler “assigns” the purchase rights to an end buyer before closing—if the auction allows assignments. When assignments are not allowed, plan for a same-day/double close.

Funding options when cash is tight: A hard money loan or bridge loan can front the purchase price; transactional funding can enable same-day/double closings when assignments aren’t allowed. You can also coordinate with your end buyer’s funds if the title/escrow timelines and auction terms permit it.

Quick path to wholesale an auction win:

1. Before bidding, verify assignment rules, deposits, buyer’s premiums, and the exact closing deadline.
2. Line up funds (hard money/transactional) and a closing team that understands auction timelines.
3. Bid with your end buyer’s buy-box and required spread in mind; factor all fees, repairs, and carrying costs.
4. If assignments are allowed, execute the assignment with your vetted buyer. If not, execute a same-day/double close.
5. Close on time to protect your deposit and your ability to participate in future auctions.

Bottom line: Auctions can be a strong source of deals for wholesaling auction properties—as long as you respect the rules, budget for deposits and fees, and move quickly from award to funding and close.

Learn more about the basics of wholesale houses within broader real estate investing to decide which approach fits your capital, timeline, and goals.

How To Wholesale Auction Properties: Step By Step

The steps for wholesaling auction properties differ slightly, depending on whether you purchase the home through an in-person auction or you go through an online auction site. Let’s start with a look at in-person auctions. Let's take a look at them:

• Build A List Of Investors
• Identify A Hard Money Lender
• Identify Auctions
• Prepare To Bid On Properties
• Bid And Win A Property
• Sell To A Cash Buyer

New To Real Estate Wholesaling? Start Here First

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Build A List Of Investors

Your first step in wholesaling auction properties—if you are new to wholesaling—is to build a list of investors and cash buyers.

One of the best ways to find investors is by subscribing to the email and direct mail lists that other wholesalers put out regarding available properties. After about a month, check with your county and find out who bought those properties. You can use a skip tracing service to get contact information for these buyers.

Another good way to connect with cash buyers is by creating an online presence that includes a lead capture form for investors. If you plan to do other types of wholesaling, you can use a similar process for capturing motivated seller leads.

You can also find cash buyers by attending real estate auctions, reaching out to hard money lenders, using social media, joining real estate investment groups, and simply networking and getting the word out that you are going to be wholesaling auction properties.

Get to know what these investors are looking for in an investment property and communicate with them regularly so you can build a reputation as a source for adding to their inventory. Doing so will make it much easier to build a quality buyers list and flip an auction home to an end buyer.

Identify A Hard Money Lender

This step is important unless you have your own cash reserves or other means of transaction financing. Because auctions will require you to go through a double close process, it’s important to have a relationship with a hard money lender so you can have the required upfront cash to make the deal work.

A hard money lender is in the business of making short-term loans to real estate investors for purposes such as this. You will pay interest or a fee for the privilege of using someone else’s money to make the purchase.

Identify Auctions

To find traditional auctions, start by browsing local government real estate auction websites or contacting them directly regarding upcoming auctions. You can also find auction listings on sites like Auction.com, Zillow, or RealtyTrac.com, where you will be able to input your desired location and get a list of upcoming auctions and their status.

If you have your real estate license and access to your local multiple listing service (MLS), you can search for properties that are scheduled for auction.

Prepare To Bid On Properties

Once you’ve identified a potential property, do your due diligence before bidding. If possible, inspect the property in person. Otherwise, review all available photos and information. Check for any liens against the property.

Calculate the home’s after-repair value or ARV so you know your maximum allowable offer (MAO). You don’t want to bid too high and win, only to have trouble finding a cash buyer who is willing to purchase it at a price that still provides you a decent profit. When estimating your costs, include the interest you will pay for the ability to use the hard money lender’s cash in the deal.

Bid And Win A Property

You will need to register at the auction and provide proof of funds before you can bid on a property. Be sure you understand the rules of the particular auction you are participating in. Some auctions require a refundable deposit at the time of registration.

In most cases, settlement takes place immediately after the auction or shortly thereafter. This differs from non-auction wholesaling, where you go under contract and assign your interests to an investor prior to closing on the property.

Wholesaling an auctioned home involves double closing. Double closing simply means two real estate transactions occur simultaneously or nearly so.

It is not specific to auctioned homes and includes three parties: the seller, the wholesaler, and the end buyer. In this case, the end buyer is the investor. This is the reason for securing a hard money loan or other types of transactional funding.

Some wholesalers opt to go the wholetailing route, which means they close on the property, then relist it on the open market after completing minor or no repairs.

Sell To A Cash Buyer

Once you have completed the transaction to purchase the auction home and received the title, it is time to sell to the cash buyer. This is where you make your profit. For example, if you win an auction for $100,000, you can turn around and sell to an investor for $110,000. You can then realize a $10,000 profit minus the cost of the hard money loan.

While your profit is typically smaller than what a flipper might expect after rehabbing a property for three or four months, the speed at which you can turn a deal over in wholesaling and the comparatively minimal risk makes it appealing to real estate investors.

 *Want to learn the proven strategies for finding cash buyers? View our video below where Alex Martinez covers How To Find Cash Buyers For Wholesaling! [FREE]

How Do You Find Auction Properties To Wholesale?

Your best bet for finding out about real estate auctions is to contact the county government in the area you are focusing on. Local government officials should be able to provide you with a list of upcoming auction dates as well as the properties being auctioned. You can get this information either by calling or visiting, although most local governments will also have this information available online.

As noted above, another option for finding real estate auctions is using a site like Auctions.com or RealtyTrac.com, among others. These sites include listings of both online and in-person auctions.

If you have a good working relationship with a Realtor or real estate agent, they are another potential source for information on auctions.

Wholesaling Houses From An Online Auction

One of the biggest differences between traditional auctions and online auctions is that you typically don’t have to produce the cash for the full purchase price immediately at the end of the auction with an online auction platform. You often have a couple of weeks to get your financing in order, though this varies by auction. This is another reason these platforms have grown in popularity.

While foreclosures are more likely to be sold at in-person auctions, REO properties—those that are bank-owned—are more likely to be sold at online auctions. It’s especially important to review the rules for each auction you’re interested in before bidding due to differences among auctions.

Before you can bid on a property through an online auction, you will be asked to register and, in many cases, put down a refundable deposit. The purpose is to ensure that anyone taking part in the online auction is a serious bidder and has a valid account and a significant amount of funds or credit available.

Some of the homes auctioned online are still occupied, so you may not be able to inspect the interiors of the homes you target. However, you can still drive past the exterior as well as check out the neighborhood. In some cases, however, self-tours are allowed, and this information will be available on the property listing.

The online auction will provide available documents for each property, including a property report, title report, and purchase agreement. You can also learn the reserve price, as well as the estimated resale value and other information.

Typically, within 24 hours of placing a winning bid, you will need to provide proof of funds. As with traditional auctions, nearly all properties are sold on an “as is” cash basis. While you typically do not have to provide your cash payment immediately, you will ultimately be paying for wholesale properties in cash to complete the purchase.

Keep in mind that in most cases, sellers are going to have the right to accept or reject bids, even if yours is the highest bid. If the property is a short sale, both the seller and the seller’s lender must approve the winning bid.

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Where Can You Purchase Online Auction Houses?

There are a number of platforms operating as online auction sites for residential real estate. Here is a closer look at some of the more popular ones out there.

Hubzu.com

Hubzu.com is an established online auction site that has sold over 230,000 properties to date. In addition to bank-owned homes, Hubzu auctions include privately owned homes, pre-foreclosures, and short sales. The site offers auction houses as well as houses for direct purchase.

You must register on the site before you can place a bid. Hubzu notes on its website that all buyers and sellers are verified and charges a one-time small fee for this. Some properties also have a technology fee added to the purchase price.

Before placing a bid, a buyer must complete the bid deposit process. The bid deposit is a hold against a buyer’s credit card until the end of the auction, whether the bidder ultimately bids on a property or not. Winning bidders who don’t follow through with obligations for completing the sale forfeit the bid deposit. A bid deposit is required for each property you bid on.

Winning bidders will see the bid deposit removed once they’ve successfully made an earnest money deposit with a third-party escrow agent within the purchase agreement’s timeframe.

The minimum required earnest money deposit is based on a predetermined percentage of the bid or offer amount. The required deposit ranges from 1% to 7%, with a minimum of $1,000 and a maximum of $15,000.

Auction.com

Auction.com is another well-established online real estate auction site. The platform has about 16,000 properties for sale at any one time and bills itself as the nation’s largest online auction marketplace. The site has chalked up $52 billion in sales to date and has 6.3 million registered buyers.

Auction.com offers users of its site a number of video tutorials on how to navigate the site, place a bid, and research properties, among other topics. Participants must register to use the Auction.com site, but there is no fee to do so.

Investors on Auction.com can bid on foreclosures at in-person auctions as well as bid in online auctions of bank-owned properties on the platform. As with other in-person auctions, foreclosure auctions listed on Auction.com need to be paid in full at the close of the auction. Auction.com recommends investors bring a cashier’s check rather than cash, made out for 5% to 10% above your expected budget. This ensures you don’t lose out on a house because of a small amount of additional cash.

Some properties will be labeled as allowing in-person inspection. Each listing also includes the purchase agreement for review and the site reminds buyers to review the details prior to bidding.

A $2,500 bid deposit hold is placed on the bidder’s debit or credit card, an absolute requirement before bidding on the site’s bank-owned properties. The bid deposit must be made per property. The hold is removed on the Saturday following the auction.

As with Hubzoo.com, the seller has to accept the winning bid before the transaction can proceed.

Xome.com

Xome.com bills itself as a helpful site for those who are beginners in real estate investing. Xome.com claims the site has seen over 100,000 properties sold and $16 billion in sales to date.

Xome.com features both traditional listings and auction properties. The site states that its auctions include bank-owned, private-owned, second-chance foreclosures, short sales, and foreclosure properties.

As a wholesaler, you will need cash or a hard money loan to pay for your auction property. You’ll also need to provide an earnest money deposit within 48 hours of winning a bid. Closing can occur as soon as 10 days after the auction ends, at which time you will need to pay the balance of the purchase price.

The auction listings include both in-person and online auctions. Xome puts a $1,000 hold on your credit or debit card when registering to use the site. The hold is removed within 24 hours after an event ends if you are not the winning bidder. If you are the winning bidder, the hold is removed within 24 hours of making the necessary earnest deposit. There are no fees to register.

Wholesaling Auction Properties FAQ

Real estate auctions—whether in-person or online—can be a great source of properties for wholesaling. But with the varying rules and the process involved, it can be difficult to decide if wholesaling auction properties is a good option for your business.

The following questions and answers may help you decide what’s best for your business.

How Can You Get An Auction Property Under Contract?

Whether you are taking part in an online or in-person auction, you enter into a contract to purchase the home if you are the winning bidder.

Rather than assigning your purchase contract, as in a traditional sale, you will then enter into a sales contract to sell the property to an investor. This is referred to as a double close because once you close on the purchase, you will want to immediately sell to an investor and close on the sale.

This illustrates why it’s so important to have a network of investors as well as a source of hard money loans before wholesaling auction properties.

Can You Get Inside An Auction Property To Check For Repairs?

Auctions do not always allow a walk-through of the interior in person, which increases your risk. If you are new to wholesaling, you may not be able to afford the risk of ending up with a property you can’t sell to an investor at a profit. The home’s ARV is harder to calculate if you don’t have access to the interior, which in turn makes it difficult to determine your maximum allowable offer.

If that sounds like too much risk, you may want to consider narrowing your search to auction homes that allow pre-auction inspections. Of course, it’s possible you may not find any homes you like if you limit yourself to those that allow pre-inspections.

Another option is to look for properties with interior photos or interior videos available. If only an exterior photo is available, the interior could very well be in worse shape than the exterior.

Having the opportunity to visit the property will also let you see if it’s occupied. If there is evidence of squatters, you may need to add the cost of removing them to your estimate of expenses.

Do You Need Proof Of Funding To Have An Accepted Contract From The Auction Site?

For nearly all auctions, yes, you are required to show proof of funds—either in the form of cash or a cashier’s check—prior to registering for the auction and bidding.

Proof of funds can be provided via cash or a cash equivalent. Proof can take the form of recent bank statements, brokerage account statements, bank letters, or proof of an existing line of credit.

Final Thoughts

Auctions are an excellent place to find homes for real estate deals. You can often get these properties under contract at a price considerably below the market price. But auctions also require cash payments, and you will purchase the property rather than assigning your purchase rights.

You will need to conduct a double close to make the wholesale deal work. Unless you have enough cash on hand to close on a property, you’ll want to build a relationship with a hard money lender to finance the first stage of the deal.

When sourcing houses from auctions, be sure you review and understand all rules, keeping in mind these differ from one auction to the next. You’ll also want to be sure you’ve done your due diligence, including checking for claims and liens, as well as ensuring occupancy status.

*Disclosure: Real Estate Skills is not a law firm, and the information contained here does not constitute legal advice. You should consult with an attorney before making any legal conclusions. The information presented here is educational in nature. All investments involve risks, and the past performance of an investment, industry, sector, and/or market does not guarantee future returns or results. Investors are responsible for any investment decision they make. Such decisions should be based on an evaluation of their financial situation, investment objectives, risk tolerance, and liquidity needs.