It may be the most pitiful auction you’ll ever see.

There is no fast-talking auctioneer, no cowboy hats, no wildly flailing arms throwing bid numbers in the air.

Instead, Lt. Steve Brown of the Douglas County Sheriff’s Office simply stands on the steps of the Judicial and Law Enforcement Center listening for the bells of nearby Trinity Lutheran Church to chime, signaling that it was 10 a.m. He won’t start until he hears the bells.

That’s how a foreclosure auction in Douglas County begins.

“They usually only take about 60 seconds from start to finish,” Brown said of the roughly 100 auctions he’ll conduct this year.

That’s because Douglas County foreclosure auctions aren’t like the ones you see on some cable television shows that attract hordes of investors looking to “flip” a house for a quick profit.

A Douglas County auction

On most days, the auctions – which are only advertised in the legal notice section of newspapers or at the sheriff’s office – attract Brown and an attorney from the bank that holds the mortgage. Thursday’s auction was a little different because the property was more unique than most: a home, horse barn and about six acres of land that is used by Rob Phillips, the former owner of the Eldridge Hotel, as a bed and breakfast.

The auction attracted a crowd of about a half-dozen people: several who had been talking with the bank about buying the property, a couple who were just curious and a few more who didn’t say why they were there.

But in the end, it played out the way it almost always does. Ben Casad, a Lawrence attorney representing the bank, stepped forward and bid $210,000. Brown announced he had a bid of $210,000 and asked if there were any others. He waited for about five seconds to let the silence sink in. He asked again. After another five seconds of silence, he announced he had sold the property for $210,000.

The striking Victorian-style home and property has an appraised value of $438,190.

Yeah, there’s a catch. Actually, there are several of them.

No poor man’s game

One of the bigger ones is that this isn’t a poor man’s game. The rules of the auction are that a bidder must submit the full amount of their bid in cash – meaning a cashier’s check or money order – within one hour following the auction.

“Some people have thought they had time to go out and get a loan,” Brown said. “But it doesn’t work that way.”

Casad, the attorney, said the money factor probably is a major reason why Douglas County foreclosure sales don’t attract as much attention as others might.

In other communities where real estate prices are relatively low, homes might sell at foreclosure auctions for only $30,000 or $40,000 because their mortgages were relatively small to begin with. But in Douglas County, Casad said most foreclosure homes have remaining debt well in excess of $100,000.

A bank will almost always make a bid that is at least as high as the remaining debt on the home. Banks bid on the home because that is the legal mechanism they must go through to actually repossess the property.

That means in Douglas County, buyers at a foreclosure auction have to be prepared to pay six figures worth of cash.

“If you have $200,000 in cash, for most people that’s probably their retirement account,” Casad said. “You’re talking about spending that type of money on a house that you’ve probably never even been in before.”

Profit not guaranteed

Yes, that’s the other catch. Unlike a traditional home purchase, a foreclosure auction doesn’t allow the buyer to go in and inspect the home for termites, dry rot or any other type of problem.

“Really, all you get to see is the outside, and that doesn’t tell you much,” said Stephen Robinson, a Lawrence resident who has bought about five homes via foreclosure auctions in the last 20 years.

Robinson, who has bought most of them as investments, said some have worked out and others haven’t. He bought a two-bedroom townhouse at a Douglas County foreclosure auction this summer. He still has that home on the market.

“The biggest thing people should know is that you don’t always make a profit,” Robinson said. “I had one that the costs ended up being three times higher than what I thought it would be because I had to do a lot of rewiring.”

Another factor to consider is that even after a home is purchased at auction, there is a court-ordered 90-day waiting period that gives the owner of the home time to pay off the mortgage and render the auction null and void.

Not such a good deal

What it all adds up to for potential auction participants in Douglas County is a particularly thin margin of error, several people said. That’s because home prices are relatively high by Kansas standards, and consequently, 95 percent, 100 percent or even 125 percent loans are common in the Douglas County market.

Homes that fall into foreclosure often do so in the first few years after purchase, which means the amount owed on the home is pretty close to its fair market value.

“I’m led to believe that typically it is not a chance to get a real good deal,” Brown said. “If it was, I suspect we would have a lot more people down here keeping me company.”