Will I get more money if I let it go to the sheriff's sale?

The short answer

Usually not. Most sheriff's sales end with the lender taking the house back for what it's owed, and nobody pays you for the equity. If you have equity, selling before the sale is usually how you keep it.

How a sheriff's sale usually goes

The lender almost always bids, usually up to what it's owed, without putting up new cash. Outside bidders have to pay quickly, usually with certified funds, and can't go inside the house first, so they bid low to cover what they can't see. Often nobody outbids the lender, and the bank takes the house.

If it does sell for more than what's owed

The extra money, called surplus, belongs to the owner, or the heirs if the owner has died. It doesn't come to you automatically: the county clerk holds it, and you claim it through the court in the foreclosure case. Be careful with anyone who calls offering to "recover" it for a big cut. You can claim it yourself, and a local attorney can help for far less.

If it sells for less

If the sale doesn't cover the debt, the lender may be able to ask the court for a judgment against you for the rest, called a deficiency. Whether that's possible depends on the case. Some judgments are entered only against the house ("in rem"), and then there's no personal deficiency. Your case on MyCase shows which, or ask an attorney.

After the sale

The winning bidder gets a sheriff's deed, and anyone living in the house has to leave. In Indiana there's generally no period after the sale to buy the house back. Some other states have one, which is where that idea comes from. A finished foreclosure also stays on your credit for seven years. A sale before the sheriff's sale that pays the loan off avoids that.

When letting it go makes sense

If you owe more than the house is worth and have nowhere better to land, letting the sale happen can be a reasonable choice. Talk to a housing counselor or an attorney about the deficiency question first. We'll tell you plainly if selling to us wouldn't leave you anything.