Why not try to stop the sale and immediately do a short sale? You may be able to get an audience with the judge and show him you submitted a short sale offer near full market value. Your credit will be significantly less damages via a short sale or deed in lieu than a full blown foreclosure.
If it's already foreclosed and the new owner (the bank) is re-selling it then you may be able to get some money back if it sells above their costs to hold this auction and the realtor fees and transaction fees for transfering ownership, etc. $3k will probably not cover the costs.