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Introduction To Tax Lien Sales |
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For more than two hundred years, the United
States government has levied taxes against real
estate. At the county government level these
taxes fund a number of services, including
hospitals, public schools, law enforcement, road
construction & maintenance, parks, and
playground equipment. When taxes are not paid,
the government does not have the operating
capitol needed for these programs. |
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Description |
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As one means of generating lost income from
delinquent taxpayers, county governments offer Tax Sales
at auction to the public. During Tax Lien Sales, what is
purchased at these auctions is not land, rather a debt
to be collected on. By purchasing the right to collect
past due taxes, a buyer is in essence loaning money to
the property owner to pay their taxes. During Tax Deed
Sales however, the winning bidder will own the deed and
the land, having purchased it from the county or
authority performing the sale.
A Tax Lien, or Tax Certificate Sale is a public sale,
usually at auction, of the right to collect on a
delinquent taxpayer's debt. This sale is held by the
County, generally once each year. What is purchased by
the winning bidder is not the deed to a property. The
purchaser's money pays the delinquent taxes to the
County on behalf of the delinquent property owner. In
exchange, the purchaser is given first lien position on
title, ahead of mortgages, deeds of trust, and
judgments, subordinate only to State tax liens.
Under the terms of the sale which may differ greatly
from county to county, if the debt is not repaid with
interest (rate determined at the time of sale) within a
specified time period, the purchaser of the tax lien may
foreclose upon the property, and all junior
(subordinate) liens are dissolved, forgiven, or
otherwise not the responsibility of the purchaser. If
you are interested in participating in a Tax Lien or Tax
Certificate Sale, contact the county for specific
information and details both about the sale and the
properties.
A Tax Deed Sale is a public sale, usually at auction, of
the deed to the property of a delinquent taxpayer. The
Owner and all lien holders have been given ample time
and have received proper legal notification that the
property will be sold if due taxes are not satisfied.
Different than a Tax Lien Certificate Sale, the winning
bidder purchases the deed to a piece of property,
becoming the new owner and obtaining all rights to the
property free and clear of liens, mortgages, deeds of
trust, etc.
It is extremely important to know and understand which
type of sale you are attending, a tax deed or tax
lien/certificate sale. Each has specific rules and
guidelines which must be followed promptly, and which
can differ greatly county to county. It is strongly
recommended that anyone interested in attending a tax
sale be aware of the method and timeliness required for
payment and delivery of a property. For further
information, familiarize yourself with property tax law,
consult a legal attorney, and contact the government
agency conducting the sale. |
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Disclaimer |
| This page has been developed to assist the
understanding of Tax Sale transactions in the
United States. NETR and NETRonline strongly
suggest familiarizing yourself with property tax
law, and seek the advice of a legal attorney
before engaging in any tax sale activity. Further,
it is recommended that you contact the governing
body and organizer of any tax sale for specific
information about registration, qualification,
acquisition, and delivery of services. NETR and
NETRonline shall incur no responsibility or
liability whatsoever for the actions of the
viewers of its Web site, its contents, and the
contents of those Web sites to which hyperlinks
have been established. |
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