§ 701.600.Defaulting Bidder

Title 9. Enforcement of Judgments · Division 2 · Chapter 3. Execution · Article 6. Sale and Collection · Enacted 1982 · no amendments on record · Last verified July 28, 2026

In one sentenceSection 701.600 requires the levying officer to resell property when the highest bidder defaults on payment, apply any deposit first to resale costs and interest and then to the judgment, and holds the defaulting bidder liable in a civil action for the shortfall, costs, interest, and attorney's fees.

Full Text of § 701.600

Text sizeJump to: (a) (b) (c) (d)

If the highest bidder does not pay the amount bid as prescribed by Section 701.590:

(a) The levying officer shall sell the property:

(1) If the default occurs at the sale, either to the next highest bidder at the amount of the next highest bid if such bidder agrees or to the highest bidder at a new sale held immediately.

(2) If the default occurs after the sale to a credit bidder pursuant to subdivision (c) of Section 701.590, to the highest bidder at a new sale.

(b) The levying officer shall apply the amount of any deposit made pursuant to subdivision (c) of Section 701.590 in the following order:

(1) To the satisfaction of costs accruing with regard to the property sold from the date of the sale until the date the property is resold, including costs of resale.

(2) To the satisfaction of interest at the rate on money judgments on the amount bid from the date of the sale until the date the property is resold.

(3) To the amount required to satisfy the money judgment in the order of distribution prescribed by Section 701.810 or Section 704.850, whichever is applicable.

(c) If there is a sale to the next highest bidder or to the highest bidder at a new sale, the defaulting bidder is liable for the following amounts in an action by the judgment creditor or judgment debtor:

(1) The amount bid, less the amount obtained from the resale of the property and the amount of any deposit applied pursuant to subdivision (b). The amount recovered pursuant to this paragraph shall be distributed in the manner prescribed by Section 701.810 or Section 704.850, whichever is applicable.

(2) Any costs accruing with regard to the property sold from the date of sale until the date the property is resold, including costs of resale.

(3) Interest at the rate on money judgments on the amount bid from the date of the sale until the date the property is resold.

(4) Costs and attorney's fees incurred in the action under this subdivision.

(d) The levying officer may, in the levying officer's discretion, reject any subsequent bid of the defaulting bidder.

Plain-English Summary

The credit-transaction option in § 701.590 comes with teeth for bidders who don't follow through. If the highest bidder doesn't pay as that section requires, the levying officer resells the property — to the next-highest bidder at that bidder's own price if they're willing, or at an immediate new sale if the default happens at the original sale itself, or to the highest bidder at a new sale if a credit bidder defaults later.

Any deposit the defaulting bidder already made gets applied in a set order: first to costs accruing on the property between the original sale and the resale, then to interest at the judgment rate on the original bid for that same period, and only then toward the judgment itself, distributed under § 701.810 or § 704.850, whichever applies.

If a resale happens, either the judgment creditor or the judgment debtor can sue the defaulting bidder for the difference between the original bid and what the resale brought in (after crediting the applied deposit), plus the accruing costs and interest already described, plus the costs and attorney's fees of bringing that action. The officer also has discretion to refuse any later bid from someone who has defaulted before.

Frequently Asked Questions

What happens if the highest bidder doesn't pay?

The levying officer resells the property, either immediately to the next-highest bidder or at a new sale, depending on when the default occurs.

How is a defaulting bidder's deposit applied?

First to costs accruing between the original sale and resale, then to interest on the original bid for that period, and then toward the judgment under § 701.810 or § 704.850.

Can the defaulting bidder be sued for the shortfall?

Yes, by the judgment creditor or judgment debtor, for the difference between the original bid and the resale proceeds, plus accruing costs, interest, and the costs and attorney's fees of that action.

Can the levying officer refuse future bids from someone who has defaulted?

Yes, § 701.600(d) gives the officer discretion to reject any subsequent bid from a defaulting bidder.

Amendment History

Added by Stats. 1982, Ch. 1364, Sec. 2. Operative July 1, 1983, by Sec. 3 of Ch. 1364.

Source & verification. Section text is reproduced verbatim from the Deering's California Codes Annotated / vLex. Enacted by the California Legislature. Last verified July 28, 2026. · Official source

Also known as: defaulting bidder execution sale california