Posted on: 04th Jun, 2012 08:32 pm
Hello, I am very confused with tax deeds. So I guess I will try to explain my situation, what I am interested in and maybe you all can give me more insight. Sorry for my ignorance on the whole subject.
I am looking at purchasing a tax deed from someone that has had it for a year in the State of Florida. The house and 2.4 acres of land sold in 2006 for $350,000, they said according to state law, I would have to hold onto it for one more year before I could go along with the foreclosure process.
So I guess my main questions are.
Why isn't the bank buying the tax deed? Don't they stand to lose whatever money is owed on the mortgage? Or if I did foreclose on it, would I still owe them and any other liens against the property?
How much does the foreclosure process usually run and how long does it take?
If someone tries to get the property back during the foreclosing process, do they have to pay you everything you paid ( foreclosing fees and any other fees that may incur ) or just what you paid for the tax deed + interest?
Is it better to buy them directly from the government or is it good to buy seasoned tax certificates?
How do other states work besides Florida when it comes to Tax deeds?
Has anyone here bought Tax deeds / certificates before?
Again, sorry for my ignorance, I've always been interested in these, and just wanted to get opinions and my questions answered on this.
Thanks everybody. :)
I am looking at purchasing a tax deed from someone that has had it for a year in the State of Florida. The house and 2.4 acres of land sold in 2006 for $350,000, they said according to state law, I would have to hold onto it for one more year before I could go along with the foreclosure process.
So I guess my main questions are.
Why isn't the bank buying the tax deed? Don't they stand to lose whatever money is owed on the mortgage? Or if I did foreclose on it, would I still owe them and any other liens against the property?
How much does the foreclosure process usually run and how long does it take?
If someone tries to get the property back during the foreclosing process, do they have to pay you everything you paid ( foreclosing fees and any other fees that may incur ) or just what you paid for the tax deed + interest?
Is it better to buy them directly from the government or is it good to buy seasoned tax certificates?
How do other states work besides Florida when it comes to Tax deeds?
Has anyone here bought Tax deeds / certificates before?
Again, sorry for my ignorance, I've always been interested in these, and just wanted to get opinions and my questions answered on this.
Thanks everybody. :)
Hello Noenoeclue,
Honeslty, the first step the government will generally take in attempting to collect back taxes. A lien certificate will be issued for the outstanding amount plus interest, and the home owner's paychecks or tax refund checks may be garnished in order to collect the back taxes. In some states, the owner may be arrested by the sheriff's office and fined or imprisoned for failure to pay real estate taxes. If none of these tactics are effective, the government will then seek permission to sell the property at auction.
:idea:
Honeslty, the first step the government will generally take in attempting to collect back taxes. A lien certificate will be issued for the outstanding amount plus interest, and the home owner's paychecks or tax refund checks may be garnished in order to collect the back taxes. In some states, the owner may be arrested by the sheriff's office and fined or imprisoned for failure to pay real estate taxes. If none of these tactics are effective, the government will then seek permission to sell the property at auction.
:idea:
Hi!
Welcome to forums!
if your buy a tax deed and then pay off the mortgage on time, then I don't think the lender will foreclose the property. Moreover, if there are any other liens on the property, then you should ask the seller to clear them off before selling it to you. A foreclosure process may take around 90 days to complete. However, I haven't bought tax deeds at any point of time.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
if your buy a tax deed and then pay off the mortgage on time, then I don't think the lender will foreclose the property. Moreover, if there are any other liens on the property, then you should ask the seller to clear them off before selling it to you. A foreclosure process may take around 90 days to complete. However, I haven't bought tax deeds at any point of time.
Feel free to ask if you've further queries.
Sussane
Thanks for both of your answers, I read from an article once before that if you buy a tax deed and you foreclose on the property, that all liens are wiped off against the property except for one state.
all mortgages are completely wiped out (except for N. Mexico)
so any of the banks or lending institutions, whether it be 1st, 2nd, etc...lose their investment!
This is what I was aware of, and just trying to get it confirmed by someone who knows a bit more on these situations? thanks!
all mortgages are completely wiped out (except for N. Mexico)
so any of the banks or lending institutions, whether it be 1st, 2nd, etc...lose their investment!
This is what I was aware of, and just trying to get it confirmed by someone who knows a bit more on these situations? thanks!
Hi Noenoeclue_is_me,
I will suggest you to contact a real estate attorney and a tax adviser and take their opinion in this regard.
Thanks
I will suggest you to contact a real estate attorney and a tax adviser and take their opinion in this regard.
Thanks
Okay, I will have to do that, I suppose. I thought we had Real Estate attorney's on this forum? I am pretty sure I've seen a few before. Okay, this is what I was able to come up with on my questions, this might be able to help others that have the same interests. I also have a few questions on top of this. That I will list at the bottom.
Property such as this does have to be foreclosed upon first and is not
otherwise available for sale, so let me explain everything to you step
by step, because there is a process to getting the deed:
Step 1: First you would need to obtain the right to apply for the deed
to the property (which is what this Tax deed is for) Here are the laws that govern this
type of transfer:
http://www.flsenate.gov/laws/statutes/2011/197.502
Step 2: After your rights to the property are secured, you can apply
immediately for the deed in person or by mailing in the deed
application to the county.
Here are two more links to the statutory procedures:
http://www.flsenate.gov/laws/statutes/2011/197.542
http://www.flsenate.gov/laws/statutes/2011/197.552
Note in 542 that deed applicant accrues 1.5% interest (or 18% APR) on
the money they pay during the duration of the deed application
process, which includes ALL the costs you have incurred, not just the
taxes.
in statute 552 it specifically states that "no right, interest,
restriction, or other covenant shall survive the issuance of a tax
deed", which means that the deed would be issued from the county
itself with clear title.
So if I owned the 2011 tax deed and now I am able to foreclosure, who owns the 2012 tax deed and would they not be able to foreclose too? ( assuming they haven't paid their taxes in a few years ) So they would also have interest in the property too, and one would have to be bought out, or am I wrong on this part?
Also, why would the bank not buy the tax lien if there is a mortgage on the property?
Again, sorry for bringing the subject back up, but I know there has to be a real estate attorney around here. >.> thanks.
Property such as this does have to be foreclosed upon first and is not
otherwise available for sale, so let me explain everything to you step
by step, because there is a process to getting the deed:
Step 1: First you would need to obtain the right to apply for the deed
to the property (which is what this Tax deed is for) Here are the laws that govern this
type of transfer:
http://www.flsenate.gov/laws/statutes/2011/197.502
Step 2: After your rights to the property are secured, you can apply
immediately for the deed in person or by mailing in the deed
application to the county.
Here are two more links to the statutory procedures:
http://www.flsenate.gov/laws/statutes/2011/197.542
http://www.flsenate.gov/laws/statutes/2011/197.552
Note in 542 that deed applicant accrues 1.5% interest (or 18% APR) on
the money they pay during the duration of the deed application
process, which includes ALL the costs you have incurred, not just the
taxes.
in statute 552 it specifically states that "no right, interest,
restriction, or other covenant shall survive the issuance of a tax
deed", which means that the deed would be issued from the county
itself with clear title.
So if I owned the 2011 tax deed and now I am able to foreclosure, who owns the 2012 tax deed and would they not be able to foreclose too? ( assuming they haven't paid their taxes in a few years ) So they would also have interest in the property too, and one would have to be bought out, or am I wrong on this part?
Also, why would the bank not buy the tax lien if there is a mortgage on the property?
Again, sorry for bringing the subject back up, but I know there has to be a real estate attorney around here. >.> thanks.
As James has said, contact a tax adviser and he will be able to assist you in this matter.
This area of tax deeds is very complicated and risky. If you are not very familiar with all the rules regarding tax deeds, do not buy the deed.
