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Monday, April 23, 2018  

Tax Lien Sales
  Introduction To Tax Lien Sales

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.



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.


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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