What happens if nobody bids at a court auction?

Question

José Manuel Alburquerque · Accepted Answer

It depends on when the enforcement began, because the law changed these rules for proceedings begun on or after 3 April 2025. In those proceedings, if nobody bids, the creditor can no longer ask for the asset to be awarded to it and the debtor can ask for the attachment to be lifted, although the debtor still owes the same amount. If the asset is a property, the debtor can also put forward someone willing to take it for at least 50 % of its auction value, or for less, but not below 40 %, if that price pays off the whole debt. In enforcement proceedings begun earlier, the creditor in principle has twenty days to ask for the asset to be awarded to it, for example for 70 % of the auction value if it is the debtor's principal residence. Enforcement proceedings begun on or after 3 April 2025 In these proceedings, a creditor who wants to keep the asset has to bid at the auction like any other interested party. If nobody bids, not even the creditor, the auction is declared void and the creditor can no longer ask afterwards for the asset to be awarded to it. The debtor can then ask the court clerk (“letrado de la Administración de Justicia”), the official who manages the proceedings, to lift the attachment on that asset. The debt is not reduced and the creditor can go on looking for other assets. If the asset auctioned is a property, from the moment the auction ends and is declared void the law also opens up these options: For the debtor, on their own initiative or at the creditor's suggestion, to put forward someone willing to take the property for at least 50 % of its auction value. For that person to take it for less, but not below 40 %, if that price pays off the whole debt. The enforcement then ends and the other attached assets are released. For the court clerk, if the offer is lower, to decide whether to accept it, after hearing the parties. For the parties to ask jointly for a new auction or another form of sale. Enforcement proceedings begun earlier In enforcement proceedings begun before 3 April 2025 the previous rules still apply, in principle, although some court clerks are already applying the new ones. If nobody bids, the creditor is not obliged to take the asset, but can ask for it within the following twenty days. How much is deducted from the debt depends on the asset: The debtor's principal residence. The deduction is 70 % of the value at which it was put up for auction. If the total owed to the creditor, counting everything, is less than that 70 %, the award cannot be for less than 60 %. Another property, such as commercial premises or a second home. The deduction is 50 % of the value at which it was put up for auction or the total amount owed to the creditor, counting everything. A movable asset, such as a car. The deduction is 30 % of its valuation or the total amount owed to the creditor, counting everything. If the creditor does not apply for the award within those twenty days, the court clerk lifts the attachment on that asset, provided the debtor asks for this. The debt is not reduced. What happens to the debt The auction value of an attached property is its valuation less the earlier charges that whoever takes it will have to assume, such as a prior mortgage. In mortgage enforcement proceedings, it is the valuation set in the mortgage deed. If the asset is awarded, the price counts as payment. It is applied first to ordinary interest, then to the principal, next to late-payment interest and finally to the costs. If it does not cover the whole debt, the debtor still owes the rest and the enforcement can continue against the debtor's other assets. If it exceeds the debt, the surplus goes to subsequent creditors or, if there are none, to the debtor. For example, in enforcement proceedings begun before 3 April 2025, if a principal residence is put up for auction at 200.000 euros, nobody bids and 180.000 is owed, the creditor can take it for 140.000 euros, 70 %. The debtor will still owe 40.000 euros. If it was the debtor's mortgaged principal residence, the law provides special rules that can reduce that balance.