Judicial, notarial and bankruptcy auctions: the differences
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Who sells and why the auction is judicialWho manages the saleHow the property is transferred to youWarranties: what you keepPrice, offer and deposit: the rules changeWhere to find the noticeWhich auction suits someone starting from scratchIn practiceFrequently asked questionsSourcesA judicial auction (asta giudiziaria) ends with a decree from the judge, not with a notarial deed. In a notarial auction (asta notarile), by contrast, the winner signs an ordinary sale deed before a notary. The bankruptcy auction (asta fallimentare), now called liquidazione giudiziale, is a third route: it is sold by the trustee (curatore) within a collective insolvency procedure. The three types of auction look alike in the notice, but they differ in how the property is transferred to you.
Who sells and why the auction is judicial
A judicial auction starts with a seizure (pignoramento). A creditor, usually a bank, asks the court to sell the debtor's property to recover the money lent. The procedure is a foreclosure proceedings (procedura esecutiva) on real estate, and the judge directs every stage. If you want to understand how the process reaches the sale, read how to get from the seizure to the auction, step by step.
In a bankruptcy auction, by contrast, the property is sold by the trustee of a liquidazione giudiziale procedure. The Codice della crisi d.lgs. 14/2019 applies to procedures opened from 15/07/2022. For older procedures, the previous bankruptcy law still applies.
In a notarial auction, finally, the seller is a private individual or an entity that chooses to entrust the sale to a notary. There is no seizure and no judge ordering the sale.
Who manages the sale
In a judicial auction the sale is entrusted to a professional appointed by the judge (sale delegate, delegato alla vendita), usually a notary, a lawyer or a chartered accountant. The sale delegate receives the offers, runs the bidding, collects the price and prepares the transfer decree (decreto di trasferimento). The court-appointed custodian (custode), by contrast, looks after the property: he or she keeps it and organises the viewings. For the detailed roles, see the figures in the auction: judge, sale delegate, custodian, appraiser.
In a bankruptcy auction the trustee sells according to the rules of the notice, and the delegated judge authorises the sale. In a notarial auction the owner sells, and the notary handles the procedure and the final deed.
How the property is transferred to you
This is the difference that matters most for you.
- Judicial auction: after you have paid the balance, the judge issues the transfer decree (decreto di trasferimento). The decree replaces the notarial deed (rogito): there is no notarial sale deed. The decree must be registered and transcribed by the sale delegate, at your expense as successful bidder (aggiudicazione / aggiudicatario).
- Bankruptcy auction: after the sale, the delegated judge orders the cancellation of mortgages and seizures. The form in which the property is transferred to you is indicated in the sale notice.
- Notarial auction: the winner signs a sale deed with the notary, as in an ordinary sale. The notary checks the condition of the property and transcribes the deed.
If you expect the classic notarial deed, you will not find it in a judicial auction. The notary, if there is one, works as delegate of the procedure, not as the notary of the purchase you have chosen. To understand what happens before the notary in an ordinary sale, read the notarial deed and what happens at the notary's office.
Warranties: what you keep
In judicial and bankruptcy auctions there is no warranty for defects (garanzia per i vizi). Article 2922 of the Civil Code says so: in a forced sale, you cannot ask for a price reduction or rescission for defects. You buy as seen in the appraisal report (perizia), so the perizia must be read carefully before you bid.
In a notarial auction, by contrast, the warranties of an ordinary sale apply. If the property has a hidden defect, you can assert your rights against the seller, within the time limits set by law.
Price, offer and deposit: the rules change
In a judicial auction the minimum offer (offerta minima) is generally three quarters of the base price (prezzo base), and the deposit (cauzione) is at least one tenth of the offer. This is governed by Article 571 of the Code of Civil Procedure.
In a bankruptcy auction the rules are those of the notice, and they may differ from the three quarters of the Code of Civil Procedure. In a notarial auction, the minimum offer, deposit and minimum bid increments (rilancio minimo) are only those written in the notice.
To understand the difference between base price and minimum offer, with a worked numerical example, read base price and minimum offer explained with an example.
Example. Base price: €100,000. Minimum offer in a judicial auction (three quarters): €75,000. If the notice of a notarial auction sets a different minimum offer, for example €80,000, that is the one that applies. You will always find the exact figure in the sale notice.
Where to find the notice
Judicial and bankruptcy auctions are published on the Public Sales Portal (Portale delle Vendite Pubbliche, PVP), as required by law under Article 490 of the Code of Civil Procedure. Notarial auctions follow other channels of publicity, but the notice should be read with the same care. To learn how to use the portal, read the Public Sales Portal: what it is and how to use it.
Which auction suits someone starting from scratch
There is no best auction in absolute terms. Some auctions take longer and involve more steps, while others have simpler rules to follow. Anyone starting out must above all understand which type of auction they are facing, because the documents, deadlines and warranties change. For the full path of an auction, from the notice to the keys, see how a property auction works, from the notice to the keys.
In practice
- Check the type of sale written in the notice: judicial, bankruptcy or notarial.
- If it is judicial, expect a transfer decree and not a notarial deed.
- Look in the notice for the rules on minimum offer, deposit and bid increments: these are the ones that count.
- Do not assume any warranty for defects in judicial and bankruptcy auctions: read the perizia carefully.
Frequently asked questions
Is there always a notary in a judicial auction?
Not always as a notary of the sale. The sale delegate is often a notary, but acts on behalf of the court. The transfer takes place with the judge's decree.
Can I have a notarial deed drawn up even if I have won a judicial auction?
No, as a rule the transfer takes place with the transfer decree. The notary steps in if you are buying through another procedure, such as a notarial auction.
Is a bankruptcy auction safer than a judicial one?
Not necessarily. The rules, timings and documents differ. In both types of auction the perizia must be read carefully and there is no warranty for defects.
Sources
In the same chapter
- Notarial auction from the Rete Aste Notarili: how it worksIn a notarial auction you sign an ordinary deed of sale before the notary, not a transfer decree. Here is how the Rete Aste Notarili works, step by step, and what to check.
- How a property auction works, from the notice to the keysA property auction runs from the sale notice to the keys: minimum offer (offerta minima), deposit (cauzione), bidding, payment of the balance within 120 days and the transfer decree. Here are the steps.
General information, not legal or tax advice: the law and the notice of sale prevail.
