lowest bid

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The lowest bid in the foreclosure auction is in the legal definition according to Section 44 (1) of the Foreclosure Auction and Foreclosure Administration Act (ZVG) regulates:

"In the case of an auction, only such a bid is permitted that covers the rights that precede the claim of the obligee as well as the costs of the procedure to be derived from the auction proceeds (lowest bid)."

Purpose of the scheme

Section 44 (1) of the ZVG expresses the principle of coverage that is central to the foreclosure auction . It states that the admissibility requirement for the bid of a prospective buyer must cover the procedural costs (procedural fee, delivery costs, costs of the expert opinion in accordance with Section 74a (5) ZVG) and the rights that precede the claim of the creditor with the highest priority. In other words: It is to be excluded that subordinate registered creditors impair priority registered creditors in their rights.

composition

The lowest bid consists of the minimum cash bid and the remaining rights. The only point of reference for the calculation of the lowest bid is the ranking of the highest ranking creditor in the land register. The lowest bid can change due to the withdrawal of the application / approval of the temporary suspension of the foreclosure auction until the award is announced. This means that it is possible to refuse the bid until the last moment.

These overriding rights include in particular:

  • the minimum part to be paid in cash ( minimum cash bid ):
    • the costs of the foreclosure auction
    • Public burdens
    • current and possibly past interest for priority rights
  • the encumbrances that take precedence over the best performing creditor (remaining rights ) in section II and III of the land register.

Depending on the case constellation, other rights or claims may fall into the lowest bid. It may also be that there are no remaining rights at all.

Case study 1

The following encumbrances are entered in Section III of the land register:

  1. Land charge "Altru-Bank" € 180,000
  2. Mortgage "Freibank" € 145,000
  3. Compulsory mortgage in favor of the building contractor Stein: € 24,785

The "Altru-Bank" operates the foreclosure auction. The market value of the property is € 260,000. The procedural costs are € 6,500. Property taxes for the last 18 months are € 1480.

The lowest bid is calculated as follows:

  • Procedural costs according to Section 109 ZVG: € 6,500
  • Property taxes according to Section 10 No. 3 ZVG: € 1480
  • existing rights of primarily registered creditors acc. §§ 44 Paragraph 1, Clause 2, 1st alternative, 10 No. 4 ZVG: € 0

Lowest bid: € 7,980

Case study 2

The following encumbrances are entered in Section III of the land register:

  1. Land charge "Altru-Bank" € 180,000
  2. Mortgage "Freibank" € 145,000
  3. Compulsory mortgage in favor of the building contractor Stein: € 24,785

Building contractor Stein operates the foreclosure auction. The market value of the property is € 260,000. The procedural costs are € 6,500. Property taxes for the last 18 months are € 1480.

The lowest bid is determined as follows:

  • Procedural costs according to Section 109 ZVG: € 6,500
  • Property taxes according to Section 10 No. 3 ZVG: € 1480
  • existing rights of primarily registered creditors acc. §§ 44 Paragraph 1, Clause 2, 1st alternative, 10 No. 4 ZVG: € 325,000

Lowest bid: € 332,980

The Rechtspfleger would reject any bid below this amount as inadmissible. Upstream of the foreclosure auction procedure is nonsensical in this constellation, since the lowest bid is far above the market value; Prospective buyers would not bid on this. In view of this, the foreclosure court would therefore inform the applicant in advance - ie prior to the issuing of the appraisal order in accordance with Section 74a (5) of the ZVG - recommend withdrawing the application for foreclosure.

Special regulation for division auction

The special feature of the division auction is that all rights and claims fall into the lowest bid that encumber or encumber the applicant's share of ownership, as well as all other rights that take precedence over or have the same rank.

Cash bid

The lowest bid will be announced by the court in the foreclosure auction before the start of the bidding period (bidding time; at least 30 minutes). For the prospective bidder, the remaining rights are of particular importance, because the bid in the auction date only refers to the cash bid, i.e. what is actually paid. To this cash bid, a bidder must always add the remaining land charges (basic securities) to be assumed by him in order to recognize the actual "price" he is offering.

literature

  • Rainer Hock, Günter Mayer, Alfred Hilbert, Ernst Deimann: Real estate enforcement . 4th edition. CF Müller, Heidelberg 2008, ISBN 978-3-8114-5165-0 .
  • Kurt Stöber: Foreclosure into immovable property - ZVG manual . 9th edition. CH Beck, Munich 2010, ISBN 978-3-406-59907-1 .
  • Karl-Alfred Storz, Bernd Kiderlen: Practice of foreclosure proceedings . 11th edition. CH Beck, Munich 2008, ISBN 978-3-406-57521-1 .

Individual evidence

  1. ↑ Kurt Stöber: Commentary on the compulsory auction law. 19th edition. of the work edited by Friedrich Zeller from the 6th to 10th edition, Munich 2009, ISBN 978-3-406-58868-6 , § 44 Note 2
  2. ↑ Kurt Stöber: Commentary on the compulsory auction law. 19th edition. of the work edited by Friedrich Zeller from the 6th to 10th edition, Munich 2009, ISBN 978-3-406-58868-6 , § 44 Note 4.1
  3. ↑ = "Class 0" In: Kurt Stöber: Commentary on the compulsory auction law. 19th edition. of the work edited by Friedrich Zeller from the 6th to 10th edition, Munich 2009, ISBN 978-3-406-58868-6 , § 10 note 1.7

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