An auction hearing can fall away at short notice. Foreclosure proceedings can be stayed in several ways: by the creditor, by the debtor, or by the court of its own motion. For bidders that means a date in the diary is not a guaranteed date. This article explains the main grounds and what happens afterwards.
Proceedings can be stayed when the creditor who applied for them withdraws the application, when the debtor applies for a temporary stay and the court agrees, or when the debt is paid in full. After a stay all bids fall away and a new hearing has to be applied for afresh.
The creditor who applied for the proceedings can have them stayed at any time. Typical reasons:
For bidders that means: the hearing can be stayed on the very day of the auction. If nobody turns up, or the creditor withdraws shortly beforehand, no auction takes place.
The debtor can apply to the court for a temporary stay. The court can suspend the proceedings for up to 6 months if:
The stay can be extended on application, but not beyond 18 months in total. After that the proceedings must go on.
If insolvency proceedings are opened over the debtor's assets, the foreclosure proceedings are usually stayed for the time being. The insolvency administrator then takes control of the property and decides whether to realise it within the insolvency.
| Ground for a stay | Legal basis | Duration |
|---|---|---|
| Creditor's application | § 30 ZVG | Until a fresh application is made |
| Debtor's application, temporary | § 30a ZVG | Up to 6 months, 18 months at most |
| Debt paid | § 30 ZVG | Permanent |
| Debtor insolvent | Insolvency code | Until the administrator decides |
| No sufficient bid, 50 % threshold | § 85a ZVG | Hearing cancelled, new date set |
Every bid falls away with nothing to replace it. A bid binds nobody once no award has been made. Bidders are entirely free and owe nothing.
The bid deposit is returned in full. No bidder has to pay anything or carries any liability when proceedings are stayed.
There are two practical consequences:
The court is under no duty to tell every bidder about a stay. Bidders should:
Our article on finding German auction dates explains how to track them systematically.
Yes. After a stay on the creditor's application, that creditor can apply at any time for the proceedings to continue. They then run on without a completely new case being opened. The appraised market value that was set usually stands.
After a permanent stay, for instance because the whole debt was paid, a creditor has to start entirely new proceedings.
Can I as a bidder prevent a stay? No. Bidders have no right to object. The decision lies with the creditor, the debtor or the court. Bidders are outsiders with no procedural rights of their own.
Do I get my deposit back if the hearing is stayed? Yes, in full and with nothing deducted. The deposit is returned at once when no award is made.
Will a cancelled hearing be rescheduled? Not automatically. The creditor has to apply again. It is quite possible that the property never comes to auction, because the debtor paid or because a private sale went through.
What if the debtor pays shortly before the hearing? If the debtor pays the whole debt, the creditor can stay the proceedings at any time, including on the day itself. No auction then takes place and every bidder goes home empty-handed.
For how the protective thresholds can block an award, see minimum bids at German foreclosure auctions. The full course of proceedings is set out in how a German foreclosure auction works.
This article is general information. It does not replace advice from a qualified lawyer.
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