Tax Deed Sales

Tax deed sales (also referred to as tax lien sales in some states) occur when a property owner has failed to pay county/city/district/state taxes. In order to recover the tax money that is owed, the jurisdiction in charge auctions off the deed to the property to the highest bidder (as long as the minimum tax due is collected) at a public auction.

While the highest bidder now owns the deed and controls the propety, the former owner is given a window of time to pay the back taxes (plus interest and reimbursement for other costs) if they want to re-claim the deed to their property. This window of time begins when the deed is auctioned off at the tax deed sale and can be anywhere from 6 months to 24 months in length.

If you purchase a deed at a tax sale, it’s important to keep in mind that you’re immediately responsible for the property in regards to having insurance, being faced with whether or not you will evict anyone living in the home, and a variety of other issues.

Even more importantly, though, the buyer at the tax deed sale is responsible for any liens on the property, as not all liens are extinguished by the auction process, so it’s vitally important that you conduct due diligence and research before buying a property at a tax deed sale to ensure that you’re fully aware of any liens that may be attached to the property.