Tax Certificates and Tax Deeds

Tax certificates represent the amount of unpaid taxes, plus interest and fees, which are sold to the public, usually investors, through a public auction known as a tax certificate or tax deed sale. Property owners are obligated to pay their real estate property taxes every year. If the taxes are not paid, the tax bill can get auctioned off to a third party.?

It's important to note that tax certificates are considered an investment opportunity for many, as the certificate buyer has the potential to earn interest on the delinquent taxes paid by the property owner. In the event the property owner fails to redeem the certificate within the redemption period, the investor or holder of the tax certificate have the option to pursue a tax deed and potentially acquire the property at a tax deed auction. As the certificate holder, you hold a priority lien on the property, which means that your claim takes precedence over other liens and mortgages on the property.?

What happens once there is a Tax Deed?

A tax deed is a legal document issued by the county when a property owner fails to pay their property taxes, and the tax certificate holder applies for ownership of the property. A tax deed effectively transfers the ownership of the property from the original owner to the certificate holder. A tax deed auction is a public auction where tax deeds are sold to the highest bidder. It is the final stage in the process of acquiring a property through the tax certificate investment process. If you decide to pursue a tax deed after the redemption period, there are additional fees and legal procedures involved. The process of obtaining a tax deed and potentially selling the property can be time-consuming and may require legal assistance.

The bidding for each certificate usually starts at 18% and decreases in 0.25% until it is sold to the lowest bidder. The amount of each certificate is the sum of the following:

• Unpaid real estate taxes and non-ad valorem assessments for the previous year
• Interest (3%)
• Sale costs (5%)

If you have any issues related to property tax payments, tax deeds and tax certificates, please contact my office for information and?resources.?