Looking to buy something at the tax auction, but how do I know what the taxes may be on the property? (auctions, sales)

[jerrry94087]

Hi,

I am looking at some properties available on the county tax auction. But I am total newbie in real estate and feel that I just don't have enough knowledge in this area. Also never owned a house.

Here are some questions that bother me:
How do I know if any liens will still be outstanding after the purchase? I hear that most, but not all liens are extinguished in auction sale.
Also what taxes will be due on the property annually?

This article and comments after it scare me: 40 Stanislaus properties with tax debts set for auction - Local - Modbee.com (past auction for another county) For example, some house was assessed at $112,000 with $48,200 in taxes owed. How is this even possible if the tax is ~1% of the property value per year and they only allow it to be delinquent for ~6 years before auctioning it?

They also talk about excessive Mello-Roos tax on the house, which is unrelated with the property value. How do I know how much Mello-Roos tax will be on a particular property? Are all properties required to pay it or this depends on the location?

They also talk that property may be taxed excessively to pay school and fire district bonds. Are such bonds rare or common? Why the particular house should pay excessive taxes even after the auction sale? Why didn't they just add the owed amount to the initial bid?

I am just afraid to get into this because of the lack of knowledge. Is there a website that I should read?

What else is important to know, besides general research about the property, before you buy?

[ETex2]

FIRST step. Tell us where you are so we can answer your questions reliably.

[NY Annie]

You need to do a google search for "buying property at a tax sale" or some variant of that phrasing. Then read.

[jerrry94087]

Originally Posted by NY Annie

You need to do a google search for "buying property at a tax sale" or some variant of that phrasing. Then read.

Thank you for this invaluable advice.
I did that, but there is not too much information online about such sales.
So I asked on this Real Estate forum.

[Silverfall]

Mello-Roos is a California thing so the OP is buying in CA.

I know the interest rate on delinquent property taxes for my county is 12%. I am sure the reason why it is so high is the interest being accumulated over those 6 years.

[NinaN]

Mello Roos are property specific. A title company can help you find out the exact amount. Though the are "unrelated" to property tax, they are billed and collected along with property tax by the tax collector.

Go to a few tax auctions and watch the action for yourself (don't buy anything!). Get to know the process and how it works first hand. Even better, team up with someone already in the business and ask them. Or go hire a good RE lawyer to help you understand the legal pitfalls.

[DevionisDream]

Originally Posted by jerrry94087

Thank you for this invaluable advice.
I did that, but there is not too much information online about such sales.
So I asked on this Real Estate forum.

1st: LMAO

2nd: I've also been curious about tax sales. It's really hard to find any information on it. The counties should have a list of homes and what they sold for at the last auction; you should check it to see how much the house sales for compared to the starting point. One day I'm going to attend a tax auction (even though most of them are turning to online sales).

3rd: I know I didn't answer your question at all.