How to buy at a compulsory auction.

Find the property

The courts publish their auction dates in the ZVG portal of the Länder. From the public list BidTerra shows address, property type, appraised value, date and case number on a map.

• Filter by state, place, property type and appraised value.
• Note the case number: it is how you find the file at the court.
• The link on the property sheet leads to the official page of the ZVG portal, where the notice and, where available, the expert report are.

Hamburg and Mecklenburg-Vorpommern are not covered: they do not publish in the ZVG portal, so look for their dates at the local courts. Schleswig-Holstein and Baden-Württemberg are only partly covered.

Read the file and the expert report

The court has the appraised value determined by an expert report. The report and the file are the most important source of information: condition, occupancy, rights, building encumbrances.

• Ask the court registry to inspect the file; many courts also make the report available in the ZVG portal.
• Visit the property from the outside if you can; you have no right to view the inside.
• The report is a snapshot, not a guarantee; often the expert has seen the property only from outside.

Understand rights and encumbrances

Not everything ends with the award. The minimum bid (§ 44 ZVG) contains the costs and the rights the buyer takes over.

• Rights of residence, usufruct and easements in section II of the land register may remain (§ 52 ZVG).
• Rights that rank ahead of the best-ranking pursuing creditor remain; those ranking behind it lapse (§§ 44, 52, 91 ZVG).
• Also check building encumbrances and public charges (such as unpaid property tax) with the municipality.

The value of the rights that remain is added to your bid and raises the tax base for the real estate transfer tax.

Provide the bidding security

At the request of a party, a bidder must provide security of 10 % of the appraised value (§ 68 ZVG). Paying in cash is not possible.

• Accepted are a cheque drawn on a bank admitted in Germany or on the Bundesbank, issued no earlier than the third working day before the hearing, an unlimited, unconditional bank guarantee waiving the defence of prior recourse, or a bank transfer to the court cashier’s account (§ 69 ZVG).
• The transfer must have arrived in the court cashier’s account before the hearing; bring the proof.
• The security is credited against your bid; if you are not awarded the property you get it back.

Sort out the financing

The cash bid falls due within a few weeks of the award. A bank usually needs time and a land charge for a loan.

• Talk to your bank before you bid and ask for a financing commitment for compulsory auctions.
• Allow reserves for renovation, vacating the property and taxes.
• The BidTerra calculator estimates the total outlay (the state’s transfer tax, court and land register fees).

To the calculator for Germany ›

Bid at the hearing

The hearing takes place at the court. The bidding time lasts at least 30 minutes and ends when nobody bids any more despite being asked (§ 73 ZVG).

• Bring identification; if you are represented, a publicly certified power of attorney (§ 71 ZVG).
• The court reads out the conditions and the minimum bid before you bid.
• A bid binds you until a higher bid is made.

Value limits: 5/10 and 7/10

Two limits protect debtors and creditors. If the highest bid is below half of the appraised value, the award must be refused (§ 85a ZVG). If it is below seven tenths, an entitled party can apply for the award to be refused (§ 74a ZVG).

• Both limits apply until the award has once been refused on one of these grounds; after that they no longer apply at a new hearing (§ 74a para. 4 ZVG, § 85a para. 2 sentence 2 ZVG).
• What counts is the bid including the rights that remain.
• The award is often granted at a separate announcement hearing, as a rule within a week (§ 87 para. 2 ZVG).

Award, payment and costs

With the announcement of the award order you become the owner (§ 90 ZVG). You pay the cash bid at the distribution hearing, plus 4 % interest from the award (§ 49 ZVG).

• Your security is credited; you pay the rest to the court in good time.
• If you do not pay, the property is auctioned again and you are liable for any shortfall (§§ 118, 133 ZVG).
• In addition there are the court’s award fee, land register costs and real estate transfer tax.

Land register and possession

The court asks the land registry to enter you as the owner (§ 130 ZVG). The transfer tax must be proved beforehand (clearance certificate of the tax office).

• The award order is an eviction title against the debtor and any occupant who has no right to possession (§ 93 ZVG).
• Tenants keep their lease, but you have a special right to terminate with the statutory notice period, only for the first permitted date; protection against termination (§ 573 BGB) continues to apply (§ 57a ZVG).
• Eviction and handover can take months. Allow for lawyers’ and bailiffs’ costs.