To bid on a foreclosed home in California, you attend a trustee sale — the state’s non-judicial foreclosure auction — with cashier’s checks covering your full bid, place the winning offer, and then wait out a short post-sale period before the trustee transfers title to you. Every bid is an irrevocable offer under California Civil Code Section 2924h, and the trustee can refuse to recognize you at all unless you show proof of funds for the entire amount before bidding.1California Legislative Information. California Civil Code 2924h What follows is the practical sequence, from finding a sale to holding the keys.
Find the Notice of Trustee Sale
Every California foreclosure auction is announced through a Notice of Trustee Sale, recorded with the county and posted on the property itself at least 20 days before the auction date. The notice is also published in a newspaper of general circulation. You can pull these notices from the county recorder, online foreclosure listing services, or the trustee company’s website.
Read the notice carefully. It contains the property’s legal description, the Assessor’s Parcel Number, the date and location of the auction, the opening bid, and — critically — the exact forms of payment the trustee will accept. Everything you do to prepare for the sale flows from what that notice says.
Research the Property Before You Bid
Trustee sale properties are sold as-is. There are no interior inspections, no seller disclosures, and no warranties about condition, access, or zoning. If you win, you cannot back out. Research is your only protection.
Title Search and Liens
Order a preliminary title report from a title company before the auction. When a deed of trust is foreclosed, liens recorded after that deed of trust are wiped out, but the buyer takes the property subject to every senior lien recorded before it. If a second mortgage is being foreclosed, for example, you buy the property still owing on the first.
Property tax liens are always senior regardless of recording date, so any unpaid property taxes become yours the moment you take title. A federal tax lien can also survive the sale if the IRS recorded its Notice of Federal Tax Lien more than 30 days before the auction and was not given proper notice.2Internal Revenue Service. Federal Tax Liens A title search is the only reliable way to catch these.
Physical Condition
You cannot enter the home, but you can drive by. Check the exterior, look for signs of occupancy, and pull the property’s permit history from the local building department for code violations or open permits. An occupied property means eviction later, which costs time and money.
Bring the Required Funds
Section 2924h lets the trustee require every bidder to prove they can cover the full amount of their final bid in acceptable funds before the trustee recognizes any bid.1California Legislative Information. California Civil Code 2924h Acceptable funds are:
- Physical U.S. currency.
- A cashier’s check drawn on a state or national bank.
- A check drawn on a state or federal credit union, or a state or federal savings and loan association authorized to do business in California.
- Any other cash equivalent specifically designated as acceptable in the Notice of Trustee Sale.
Most experienced bidders bring several cashier’s checks in staggered denominations so they can combine them to hit their final bid as closely as possible. Checks are typically made payable to the trustee or to the bidder, so the bidder can endorse them over at the sale. The specific rules for your auction are in the Notice of Trustee Sale — read it again the day before.
Registration happens on site, usually at the county courthouse steps or another designated public location. You fill out a form with your legal name, contact information, and taxpayer identification number so the trustee can prepare transfer documents if you win. Some trustees run their auctions on online platforms that require advance registration, a signed disclosure, uploaded ID, and a deposit before you can place a bid. Unsuccessful deposits are typically refunded within several business days.
How the Auction Runs
The trustee or auctioneer reads the property’s legal description and announces the opening bid. That opening figure is set by the lender and generally reflects the unpaid loan balance plus accrued interest, late fees, and foreclosure costs. The lender does not bring cash; it “credit bids” by applying the debt owed to it. If no third party bids higher, the lender takes the property back and it becomes bank-owned real estate.
To bid, you state your offer aloud or raise the paddle issued at registration. Online, you enter bids through the platform. Increments are set by the auctioneer and can start as low as $100. The auctioneer calls for final bids, and when none come, declares the property sold to the highest bidder. That declaration binds you to the purchase.
The 15-Day and 45-Day Post-Sale Window
Winning the auction does not always end the story. Under Civil Code Section 2924m, whether the sale is immediately final depends on who wins.3California Legislative Information. California Civil Code 2924m
If the high bidder is a prospective owner-occupant — someone who signs a declaration promising to live in the property as a primary residence within 60 days and stay at least one year — the sale is final immediately under Section 2924h. The former homeowner and their immediate family (spouse, parent, or child) cannot qualify.
If the high bidder is anyone else, typically an investor, the sale does not close for 15 days. During that window, an eligible tenant buyer or other eligible bidder can submit a written notice of intent to bid. Eligible bidders include prospective owner-occupants, existing tenants, and certain nonprofit organizations. If a notice of intent is filed within 15 days, these parties have up to 45 days after the auction to submit a qualifying bid:
- An eligible tenant buyer must submit a bid equal to or greater than the last and highest auction bid, paid in full by cashier’s check or cash.
- Any other eligible bidder must exceed the last and highest auction bid.
If you win as an investor, plan for your funds to be tied up during this period and accept that you can be displaced by a matching tenant bid or a higher eligible bid. If no qualifying bid comes in, the sale becomes final at the deadline.
Closing and Recording the Deed
Once the sale is final, you surrender your cashier’s checks to the trustee. The trustee issues a receipt, refunds any overage within several business days, and prepares the Trustee’s Deed Upon Sale — the document that transfers ownership to you. The trustee records the deed with the county recorder where the property sits.
Under Section 2924h, the sale is perfected as of 8:00 a.m. on the actual date of sale, provided the deed is recorded within 21 calendar days of the auction (or the next business day if day 21 falls on a day the recorder is closed).1California Legislative Information. California Civil Code 2924h You typically receive the recorded deed by mail within a few weeks.
California non-judicial foreclosures give the former homeowner no statutory right of redemption. Once the Section 2924m windows pass, the former owner cannot reclaim the property by paying off the debt.
Taking Possession
The deed gives you title, not the keys. If anyone is still in the home, you have to use California’s legal eviction process.
Former Owners and Holdover Occupants
Under Code of Civil Procedure Section 1161a, you serve a three-day written notice to quit on anyone holding over after the trustee sale. The three days exclude weekends and court holidays.4California Legislative Information. California Code of Civil Procedure 1161a If they do not leave, you file an unlawful detainer lawsuit. The case usually takes several weeks to a couple of months depending on the court’s schedule and whether the occupant contests it.
Bona Fide Tenants
If tenants signed a lease before the foreclosure and pay market rent, the federal Protecting Tenants at Foreclosure Act requires at least 90 days’ notice before they must vacate. The Act, originally passed in 2009 and made permanent in 2018, applies to foreclosures on federally related mortgage loans.5Federal Reserve. CA 18-4 Restoration of the Protecting Tenants at Foreclosure Act Tenants with a lease predating the foreclosure generally can stay until it expires, unless you intend to occupy the property yourself, in which case the 90-day notice still applies. Local California ordinances may add further protections.
Cash for Keys
Many buyers skip litigation and pay the occupant a lump sum, often a few hundred to a few thousand dollars, in exchange for a signed agreement to vacate by a set date and leave the property clean. It is usually faster and cheaper than an unlawful detainer, and it lowers the risk of damage on the way out.
Costs to Price Into Your Maximum Bid
Your winning bid is only part of what you pay. Build the following into your ceiling before the auction:
- Documentary transfer tax, imposed by counties at $1.10 per $1,000 of purchase price (or $0.55 per $500), plus any city transfer tax on top.6California Legislative Information. California Revenue and Taxation Code 11911
- County recording fees for the Trustee’s Deed Upon Sale, typically around $25 to $80 depending on county and page count.
- Title insurance, which standard policies may not cover for trustee-sale purchases; specialized policies cost more, and going without leaves you exposed to any undiscovered defect.
- Eviction costs, including service of process, court filing fees, and attorney fees if you file an unlawful detainer.
- Repairs, deferred maintenance, and any code compliance work. If the property sat vacant, local fines for failure to maintain can reach $2,000 per day for the first 30 days and $5,000 per day after that.
- Unpaid property taxes and any senior liens that survive the foreclosure, all of which become your obligation the moment you take title.
A property that looks like a bargain at the opening bid can turn into a loss once senior liens, back taxes, and repairs are counted. Do the title work, price the risks, set a ceiling, and stop bidding when you hit it.