There are three very easy explanations that happen on a daily basis; however, one is tragic. The other two are genius.

Scenario #1 (which is usually the case): The bidder is a newbie, doesn't understand about foreclosure auctions, and how you have to research the title and that other liens and encumbrances do not automatically fall away after the auction. The newbie loses his shirt. This happens daily multiple times a day across the counties. I see it all the time.

Scenario #2: An experienced investor is buying HOA foreclosures and doing the "HOA Play", and when they win the bid, they are defending the foreclosure and putting a renter in and trying to make back their money as quickly as possible and as soon as they get the money from the renters that they spent on the bid, anything after that that they are able to delay the other foreclosures for is pure profit. I know some investors have been able to defend foreclosures for a decade or longer.

But typically, unless the place rents for over $10K a month, no investor is going to do this for a $200,000 property, which most likely only rents out for $2,000 - $3,000 per month.

Scenario #3: An experienced investor knows something about the mortgage you don’t and is confident they can either negotiate it much lower or get rid of it altogether. A company like equityfixers.com help investors do this.