What the plaintiff's max bid means 

Where the number comes from

Florida lets a clerk run a foreclosure sale online, and the statute that allows it also says the clerk must accept an advance credit proxy bid from the plaintiff of any amount up to the plaintiff's maximum allowable credit bid. That pre-set proxy is the plaintiff's max bid.

The ceiling comes from the final judgment. Under the standard form, if the plaintiff is the purchaser the clerk credits its bid with the judgment total plus the interest and costs that accrued after the judgment, or as much of that as the bid needs. The plaintiff is bidding money it is already owed, not new cash.

That is also why it does not post a deposit. The St. Johns County clerk states that plaintiff representatives need no 5% deposit to take part, and that an account with plaintiff access cannot be used to bid as a third party.

Why the plaintiff max bid is sometimes hidden

The plaintiff can choose not to display its pre-placed maximum. The Alachua County clerk warns bidders that when the plaintiff hides it, bidding can jump as soon as the live auction begins, and that the $100 increments do not show until then. None of the clerk pages we read gives a reason for hiding it.

Hidden changes the clock as well as the screen. In St. Johns County, any bid in the last 30 seconds extends the auction by a minute while the plaintiff's maximum is hidden. When it is displayed, only a bid above the plaintiff's extends the clock, and a lower bid does not.

What we watch: A hidden max bid is not a low one. Estimate it from the judgment total plus interest and costs since the judgment, and treat it as at least that until the docket says otherwise.

How it relates to the final judgment amount

The judgment total is the base, not the whole number. It keeps earning interest after the judgment, and the plaintiff keeps paying costs such as the clerk's sale fee, which the form judgment adds to its credit. The statute also lets the plaintiff set its max bid below that ceiling.

The Monroe County clerk explains what bidders see on sale day. A plaintiff's representative often bids just $100, to keep its documentary stamp tax down. Once others bid, the plaintiff will typically bid up to the judgment amount, and may go higher depending on the mortgage balance and its own estimate of the property. In rare cases it lets the property sell for less and asks the court for a deficiency judgment against the borrower.

Can a third party beat the plaintiff max bid?

Yes, but only by bidding more than it. Below the plaintiff's maximum, its proxy bid outbids you and the property goes back to the plaintiff. Above it, you win. The Alachua County clerk describes preset bids as moving the auction to the highest bid at $100 more than the next highest, so the winner pays one increment over the runner-up, not its own maximum.

An illustration, not a real case: the judgment is $212,000 and the plaintiff's max bid shows $218,500 after interest and costs. Your proxy maximum is $240,000, so in a county bidding in $100 steps you win at $218,600. Set your maximum at $215,000 instead and the plaintiff takes the property back at $215,100.

Whatever you pay beyond what the judgment and costs give the plaintiff is surplus. It goes to junior lienholders and the former owner, never back to you.

Your number has to come from the property, so set your own maximum bid before you look at the plaintiff's.

What we watch: Read the max bid next to the judgment and the market value, never on its own. It tells you what the plaintiff will pay, not what the house is worth to you.