There is a risk of ownership disputes in foreclosed properties. When a legally auctioned house is accompanied by a lease agreement, even if there is a change in ownership, the lease agreement remains valid. The lessee can renew the lease in accordance with the law and can use the house until it is fully performed. Therefore, purchasing a foreclosed property often comes with ownership disputes.
According to Article 22 of the Provisions of the Supreme People's Court on Several Issues Concerning Online Judicial Auctions of People's Courts
If the online judicial auction is completed, the online judicial auction platform will automatically generate a confirmation letter based on the true identity of the buyer and make it public. The ownership of the auction property shall be transferred upon delivery of the auction transaction ruling to the buyer.
The house auctioned by the court is usually a debtor or defendant in a bankruptcy case who fails to fulfill the corresponding debt (commonly known as a debtor), and the court enforces its property.
