Failure to pay at foreclosure auction question

[Patrick Desjardins]

Hey guys,

I was foreclosing on a 2nd mortgage in Florida and just expected it to revert back to us and end up as a rental subject-to the first. Someone actually bid on it and had to deposit $7,500 but then didn't deposit the winning bid. Wasting all this time rescheduling seemed annoying but I thought we would come out with some money for our troubles.

Speaking with the clerk's office, she told us they were keeping the deposit etc despite their website stating:

" The Clerk will assess from the deposit, a non-refundable fee as permitted under Florida Statute 45.031, and a non-refundable registry fee as permitted under Florida Statute 28.24. Any remaining funds from the deposit shall be applied toward the judgment."

So, I was getting confused since I always thought that we were getting the person's deposit (or at least a good chunk) as a payment for our time and money lost with having to reschedule another sale. This note is managed by a servicer so I didn't get to speak with the attorney directly, and of course they can't answer in a clear and simple manner when you inquire about it. Here's what they say:

"Pursuant to statue, the Clerk keeps the winning bidder's deposit and uses those funds to pay for the cost of the re-scheduled sale. If funds remain (which appears likely here), those funds get applied toward the judgment. As for the client's funds, client would not have funds deposited because client had a credit bid on this sale up to the amount of client's judgment because the sale was the result of the judgment of foreclosure in client's favor. Client should still have the same right to a credit bid on the rescheduled sale."

What in the world does this mean?

[Wayne Brooks]

Not sure how the "gets applied to the judgment" works, always thought it meant the creditor got it at some point,reducing their judgment amount owed by that much.  The clerk takes out their 1.5% fee, plus some misc fees, and you get credited the rest when it eventually sells at a subsequent auction, some how.  Guessing that someone figured out they were bidding $150k on a 2nd mtg foreclosure, after they bid, huh?