R. KELLY Takes DEVASTATING Loss on Mansion Auction

R. KELLY

Takes DEVASTATING Loss

on Mansion Auction

R. KELLY Takes DEVASTATING Loss on Mansion Auction

This has gotta hurt ... R. Kelly's Illinois mansion was auctioned off Monday for $950,000 -- waaaay less than the $3.5-million-mortgage the singer took out to the build the place. 

Kelly built the 20,000-square-foot dream home back in 1997 -- but things took a turn for the worse in 2011 ... when his bank tried to foreclose, claiming he hadn't made mortgage payments for over a year.

Kelly tried selling the crib for $1.6 million to block the foreclosure  -- but no cigar ... it sat for a year. The bank then went full bore on foreclosure ... and it sold Monday for $950k.

The house has 6 bedrooms, 8 baths, an indoor pool, theater room and private lake. 

In case you're wondering ... THIS IS NOT the home where R. Kelly may or may not have peed on a girl.