what steps do i have to go through to buy delinquent tax property?

Question

tell me the steps i need to do to buy tax property thanks.my uncle bought a nice home on the court house steps in va. years ago and lived in for years. id ask him but he is dead now and i want to help my sister buy a home. she dont have any money so we need to get ALL the low down on how to buy the tax property. can we get a bank to loan her the money on the property when we find the one she wants thanks very much.HELP ive heard you can buy a place for just the TAX and not owe anything else. if there is a loan on the place HOW can a person OWN it i dont understand this....

Answer 1

homes that are sold on the court house steps have been foreclosed. she needs to first get preapproval for a mortgage. check with your local courthouse or check the local paper for when the auctions will be. the auctions starting bid will be what is owed on back taxes but rarely do any of these homes go for just that. the auctions can get high because investors are usually there bidding for the property.

Answer 2

Do your homework. The delinquent tax sale processes vary by state and from county to county. Generally, the state has rules/guidelines, but the counties can have variations in the implementation.

There are generally two types of tax sales. The first is a tax deed sale, where the winning bidder gets some type of limited warranty deed to the property which means you have work to do to "quiet title" and make sure no other lienholder interests are lurking around.

The other type of tax sale is involves tax certificates, where the bidder wins an interest-bearing certificate of sorts and must then initiate a foreclosure to gain title to the property. These are good because when the foreclosure completes (again check the states rules), you generally get title free and clear from other liens. However, that tax foreclosure requires time, attorneys, and fees.

Either way, you should expect to pay money at the tax sale, on the day of tax sale in most cases. Contact the real property tax office of the county you are interested in - they can provide more info on the process there. Oftentimes it is detailed on a website with plenty of FAQs.

It IS possible to buy a place for just the tax, but expect to make substantial repairs if you do get it cheap.

Regarding your last statement about how can a person OWN it, I'm not sure I understand...I can own my residence, and the bank can have a lien/interest for the mortgage, and my local municipality can have a lien/interest for property taxes, water bills, special assessments, etc. There can be judgments, liens, etc. out the wazoo on a property, which are independent of who holds title (OWNS) the property.

Good luck

Answer 3

Sorry, you're going to need cash to do this. At the tax sales I've been to in Florida, the winner must pay for the property by the end of the business day.

Even if you get the property at the tax auction, that does not necessarily mean that you own it free and clear. You are usually give a Tax Deed for the property. You then have to take it to court to 'quiet' the title. That is, notice is given that you intend to take full posession and title to the property. A court hearing is held and anyone who may have had interest in the property can come to court and try to claim it. A judge will then decide who gets the property. You will need a lawyer to do this.

I know that there are a lot of TV entrenpeneurs who try to tell you how easy it is to get tax properties but it is not for the inexperienced or for someone who can't afford to gamble with some money. Consult the laws in your state as they probably differ some from what you're reading here.

I hope you found this information useful. If you have any other questions, feel free to visit my website at www.flwaterhomes.com

Jim Reske, Realtor
ERA Advantage Realty, Inc.
Port Charlotte, FL

Answer 4

Most likely such properties are fully owned and the people do not pay the taxes so the county takes the property to sell it to get the tax owed. Otherwise the Bank would take it back, pay the tax and sell the property at market value. Check with your local County Assessor (Tax Collector) to see if they have a list of deliquent property. Generally these places will not be like your Uncle's but they would be a start. They will be nasty run down shacks that need rehabilitation. All the good stuff would be higher priced at auction and gobbled up by real estate speculators who do it for a living. Good luck.

Answer 5

The tax lien and tax sale laws vary from state to state. Typically, you are buying the tax lien from the county when you purchase a tax lien. You are then entitled to the state's (or county's) rights to that debt. Tax liens may or may not be the superlative lien. Typically, a tax lien is superlative to other known liens (ie mortgage), but not to other tax liens (read IRS). The tax liens typically accrue interest (In Oklahoma, it's 8%). Once a set period of time goes by, you may attempt to foreclose be posting notice on the property and serving notice to other creditors. The property owner then has a set period of time, typically 60 days to pay the lien off plus a any other expenses you have directly accrued in relation to the foreclosure.

I have tried this twice and both parties paid the liens. I made interest and had my expenses recouped, but not my time. I tried it in another county for a small lot and I got the lot.

The other is a tax sale, or tax resale. The counties have these sales at least once per year. In these sales, you are buying the property. I t may still have liens on it and you would have to do quite a bit of research to find that out. The opening bids are low (2/3 of assessed value...Assessed value is typically 20% or less than the market value.

I purchased a lot valued at $2500 for $100 at one of these sales.

Hope this helps.

Answer 6

You need a lawyer to answer those questions. Don't try to "wing" it or you could have a lot of problems.