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Old 04-07-2017, 02:21 PM
1,130 posts, read 637,263 times
Reputation: 1976


I know nothing about the process but a lot adjacent to one I own is going up for a Tax certificate auction. I think this lot is of little use to anyone else but would enlarge the usable space of my property. By it self most of the lot has too much slope for a septic system.
My lot has a dwelling that is not ready to live in without extensive work being done. Combining the properties might make it easier to sell and get it all out of my life.
I would like to add this lot to my adjacent property, but I don't want it bad enough to jump through hoops to get it.
Any thoughts/advise?
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Old 04-07-2017, 05:13 PM
28,407 posts, read 69,129,798 times
Reputation: 18278
Every state has different laws regarding the "rights" of the delinquent tax payer. Some counties also put additional "safeguards" in place that are designed to make it harder for someone having financially difficulties to "lose" their property.

If you can research those things and the "hoops to jump through" are not too bad this might be a good option -- of course the amount of back taxes would have to be paid and you would have to comply with the other rules (the redemption period where the title holder could reimburse you for taxes and allowable interest is the key...).

The fact you are doing to this to make your property "larger and more sellable" with a dwelling "that needs extensive work" makes me wonder if you could recoup the costs...
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Old 04-08-2017, 02:04 AM
1,130 posts, read 637,263 times
Reputation: 1976
A county person on the phone said one would only be responsible for the current years taxes. I would need to verify that. I downloaded and printed a document that outlines the process. There are severe references to specific state codes. I'm waiting for a return call from a lawyer. I also called a title company and may get a call back. I think, taxes might be around $100 for 1 year. The main cost might be lawyer & title search fees. I only have 3 days to figure this out before the auction takes place.
I think I have online pre registered for bidding. The web page looked like the right thing.

Last edited by johnd393; 04-08-2017 at 02:46 AM..
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Old 04-08-2017, 05:22 AM
Location: Bloomington IN
6,146 posts, read 7,362,567 times
Reputation: 14879
I would be very surprised if you do not have to also pay the back taxes owed. Someone has to do so.

FYI--again--very state specific--find out if the owner has the right to redeem the property and for how long the owner has that right. In my state an owner has a year to redeem the property by paying all overdue taxes plus a penalty (10%) to the person that bought it at auction. If there is a redemption period in your state, you won't be able to sell it until that time has passed.
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Old 04-08-2017, 09:39 AM
302 posts, read 157,174 times
Reputation: 494
In Indiana, the minimum bid at the tax sale includes all back taxes. If you make the highest bid, you get a tax lien certificate. You then have to go through several stages of notifying the property owner. There are lawyers that offer that service and at least one company that offers to do it for less money ($400 opposed to $900). If the owner pays the back taxes within one year, he has to pay you what you paid for the lien, plus 10%, plus what you paid for the notification service, assuming the lawyer or company registered their fees at the County office correctly. If he does not pay them, your agent will apply to the Court for a deed after one year, and you will then get the title if everything was done right.
The lawyer I consulted pointed out that you have the right to secure the property if it is abandoned. You also will be liable for any liens put on the property between the tax sale and a title being issued to you, so keep the lawn mowed.
If the property does not sell at the tax certificate sale, the County may offer it later at a Commissioners' Sale, which reduces the notification time from one year to six months, or may acquire the title and offer it at a Deed Sale. In the latter case, you don't have to notify anybody, since the County owns the property and you are buying it from them. In Wayne County, the opening bids are $500 for houses and $100 for lots, and I have seen properties sell for that. Ones that need work, of course. I have also seen them bid up to $9,000.
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Old 04-08-2017, 01:37 PM
1,130 posts, read 637,263 times
Reputation: 1976
Thank you for your informative reply. What you are saying sounds pretty close to what's said in the information document I downloaded. I think the "Redemption Period" is 120 days. A news article about the sale, I found online, says 1 year. It says the lien buyer is not responsible for back taxes & penalties. The article says minimum bids can be as low as $50 -$300 for properties that have gone unsold at previous tax sales. There's no lawn, no HOA, no rules, nothing to maintain.
I may not have time to find the lawyer before I place a bid. Maybe a winning bid only exposes me to loss of the bid amount since I wouldn't yet own the property.
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Old 04-09-2017, 04:51 PM
Location: Portland, Oregon
9,880 posts, read 16,200,939 times
Reputation: 6291
That might not absolve you of other liens on the property.. mortgage, contractors who worked on the property. Taxes may not be the only issue.
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Old 04-10-2017, 03:11 PM
8,943 posts, read 10,898,797 times
Reputation: 14050
Are you buying the property at the sale or just the right to purchase after the redemption period for the back taxes? Will you hold the deed or just the right to foreclose on the property after the redemption period? Are you bidding up the offer or bidding down the interest? You really have to know and explain how the tax auction works as there are many way these things work and some are nothing like a person thinks.
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Old 04-10-2017, 04:03 PM
1,130 posts, read 637,263 times
Reputation: 1976
What I think I understand
1 A winning bid would get me a tax sale certificate which represents a lien on the property. I don't own it yet.
2 Notifications to the owners must be done in a specific manor and time.
3 The owner,s have a specific redemption period to pay me off, including my expenses and interest, if I properly recorded and submitted my costs.
4 If the property is not redeemed, I must petition the court for a Tax Deed. I get the deed if I've done everything right.

I've not had sufficient time to prepare for this. The best thing that can happen is, there are no bids and it comes up again on another sale later

Ok, got more info. minimum bid is $not much. It has failed to sell at multiple previous sales. A "tax sale", as opposed to this "certificate sale" would have required payment of $5000+ of back taxes..
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Old 04-11-2017, 04:07 PM
1,130 posts, read 637,263 times
Reputation: 1976
I got it, 1/3 acre lot, $50, so far.
I would guess the crowd at 150-200. Many properties went for minimum bids of $50 or $75. Many went unsold, no bids. We saw one go up to $7000. There were hundreds of properties. We left the room after winning our bid so only watched 20% of it. Seemed everyone there had an interest in a specific property..
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