Lender Confirmation Auction

DEFINITION of 'Lender Confirmation Auction'

A type of foreclosure auction where the highest bid must be approved and accepted by the lender (usually the bank). Lender confirmation auctions are opposed to an absolute auction, where the winning bid gets the property. The property is typically advertised as "subject to lender confirmation." The sale is still conducted as an auction wherein interested parties bid on the property, but the sale does not automatically go to the highest bidder.

BREAKING DOWN 'Lender Confirmation Auction'

Short sales are another type of real estate sale where a bid for offer is subject to lender confirmation or approval. A short sale, however, is conducted similarly to a traditional home sale, without an auction. A lender confirmation auction is conducted when the lender pursues a foreclosure but will not agree to a bid price that falls below its reserve price.

RELATED TERMS
  1. Absolute Auction

    A type of auction where the sale is awarded to the highest bidder. ...
  2. Reverse Auction

    A type of auction in which sellers bid for the prices at which ...
  3. Reserve Price

    A minimum dollar amount that the owner of an item up for auction ...
  4. Dutch Auction

    1. A public offering auction structure in which the price of ...
  5. Real Estate Owned - REO

    Property owned by a lender - usually a bank - after an unsuccessful ...
  6. Auction

    A system where potential buyers place competitive bids on assets ...
Related Articles
  1. Personal Finance

    Should You Buy A House At Auction?

    The traditional real estate market isn't the only place to conduct your home search. Auctions also bring many buying opportunities.
  2. Personal Finance

    Should You Buy A House At Auction?

    In theory, many of the best properties are auctioned. But auctioned properties aren’t always hidden gems.
  3. Markets

    Explaining Dutch Auction

    A Dutch auction is a public offering auction.
  4. Personal Finance

    eBay vs. DealDash: Comparing Auction Sites (EBAY, PYPL)

    Learn how the bidding process works at DealDash and eBay, and discover the potential pitfalls when making bids at these auction sites.
  5. Markets

    What's a T Bond?

    Treasury bonds, or T-bonds, are marketable securities issued by the US government, and are available in increments of $100. Bonds have a maturity range of ten to 30 years, with 30 being the most ...
  6. Entrepreneurship & Small Business

    3 Reasons To Buy Government Surplus for Your Small Business

    Learn why it's wise to access government surplus auctions to buy furnishings, equipment and other items to start a new business or expand an existing business.
  7. Financial Advisor

    Helping Clients Navigate Short Sales And Foreclosures

    Both buyers and sellers can benefit from a real estate professional experienced in dealing with short sales and foreclosures.
  8. Personal Finance

    Investing In Foreclosures Not A Get-Rich-Quick Venture

    Investing in this kind of real estate takes capital, time and careful planning.
  9. Investing

    Find Income-Generating Properties Online

    Discover the best websites for finding valuable properties that can earn you income.
  10. Personal Finance

    Purchasing A Short-Sale Property

    If you are looking for a good deal and have time to wait, a short-sale house may be for you.
RELATED FAQS
  1. What's the difference between short sales and foreclosures?

    Understand the difference between a short sale and a foreclosure; both result in the loss of a home, either through a sale ... Read Answer >>
  2. What factors should I consider when shopping for the best mortgage lender?

    Comparing lenders to obtain the best mortgage loan requires research and willingness to shop around for the best loan to ... Read Answer >>
  3. What are the maturity terms for Treasury bonds?

    Learn how treasury bonds pay interest, when they reach maturity and the differences between terms for treasury bonds and ... Read Answer >>
  4. What does it mean when my broker says that shares are for auction?

    An auction market is one in which stock buyers enter competitive bids and stock sellers enter competitive offers at the same ... Read Answer >>
  5. Does inflation favor lenders or borrowers?

    Find out under what circumstances inflation benefits borrowers more than lenders and in which situations inflation can be ... Read Answer >>
  6. What’s the difference between a mortgage lender and a mortgage servicer?

    Buying a home is an exciting and confusing process. Once the loan is secured, it's important to know who gets the payment: ... Read Answer >>
Hot Definitions
  1. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  2. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  3. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  4. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  5. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  6. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
Trading Center