Tax Sales

If you do not pay your property taxes by December 31st, you may get a delinquency notice from the tax collector of your parish or local municipality. 

The notice informs you that you are delinquent on your taxes. It also includes information about the amount due, the due date, and any penalties or interest. The notice will also explain the consequences of not paying your delinquent taxes. This may include a lien that might get placed on the property and potential foreclosure. The notice provides contact information for the parish tax collector for more questions.

Before the property goes up for tax sale, the local government is required to make sure owners know their property is going up for a tax sale.

This notice is sent to owners by certified mail and is published in a local newspaper or posted in public areas. It includes information about the taxes due, the date and time of the sale, the set-minimum bid, and the sale terms. The presale notice also includes information about the property itself and any liens.

After proper notice has been given about the tax sale, the parish sheriff or other appointed official conducts the tax sale on the date advertised in the notice. 

At the sale, your property or part of it may be sold to pay off a delinquent tax bill. The bidding begins with the opening bid being set at the amount of the delinquent taxes. The successful bidder pays the amount of the bid in cash or certified funds and gets a certificate of sale.

However, not every property gets a bid at a tax sale. If the property does not sell at the tax sale, it may be forfeited to the local government. In that case, the local government gets a type of tax deed for the property.

After the tax sale, the purchaser and owner of the property will get notice of the tax sale. There may be multiple notices sent out. Usually, a notice goes out within 30 days of the tax sale. Usually, another notice goes out within 90 days of the expiration of the redemptive period. The notice provides all the information about the tax sale purchaser. It also includes a copy of the tax sale certificate and other documents. The notice provides information about the redemptive period. This gives all the information about the right to redeem the property. If the owner of the property does not seek redemption then the purchaser may get the property. The purchaser has the right to seek confirmation of the tax title and take actual possession.

After the tax sale, the redemptive period for the owner of the property begins. The owner of the property may seek redemption. Payment for redemption includes the past tax balance with a five percent penalty. Simple interest also accrues at one percent per month.

The owner can pay redemption costs to get a redemption certificate. The redemption certificate gets issued in the name of the tax debtor. The certificate must get filed in the appropriate conveyance records.

To learn more about redemption visit the resource Tax Lien Redemption. 

The owner can pay redemption costs to get a redemption certificate. The redemption price gets calculated by the tax collector and paid to the tax collector. 

The redemption certificate gets issued in the name of the tax debtor. The certificate must get filed in the appropriate conveyance records.

To learn more about redemption visit the resource Tax Lien Redemption. 

After the redemptive period ends the purchaser can file for quiet title action. In simple terms, this means the purchaser sues the former owners to get full property rights. The court suit to quiet title can end all rights of everybody but the tax sale purchaser. The purchaser must file court papers to quiet the title. They must also serve the papers to anyone with an interest in the property. The owners of the property may defend the lawsuit by attempting to annul the tax sale. If they don't the property may become the property of the purchase. 

A late redemption is the sale of your tax sale interest back to the tax debtor. It is not uncommon for tax debtors to contact you after the redemption period has expired. You can also contact them. The price may be negotiable but the typical starting price is the redemption price plus a premium.

To learn more about redemption visit the resource Tax Lien Redemption. 

There are three main things a homeowner can do to stop a tax sale.

• If the homeowner is on active duty with the United States military, he or she must notify the tax collector of this fact to try to stop the sale. The federal law at 50 U.S.C. § 561 has more information about when being in the military can prevent a tax sale.

• The homeowner can stop the sale by paying the taxes and other fees owed, and the homeowner must do this before the opening day of the tax sale.

• The homeowner can stop the sale by filing for bankruptcy: the court will order a stop to the tax sale.

A defense to a tax sale is a pre-sale notice. Before the sale, the tax collector, as sheriff, must provide notice by mail and publication. The sheriff must send a pre-sale notice to you by certified mail. The presale notice must also get posted in a public area like a newspaper twice. This must get posted fourteen days in advance of the sale.

A presale notice is a public notice that includes information about the taxes that are due. It provides information about the date and time of the sale, the bid that must get made, and the sale terms. It provides information about the property itself. The presale notice may also list any liens and encumbrances with the property. 

The tax collector must show a reasonable and diligent effort to provide notice of the sale. Even when you don't get actual notice of the sale, if the collector shows this, you may not be able to annul the tax sale.

The tax sale is still a valid sale but the tax sale buyer can only get part interest in the home or property.  If there is no redemption of the property by the owner, then the property can get sold again at a public auction. Part of the proceeds may get paid to the tax sale purchaser.  The homeowner would receive any remaining funds. The property owner loses the house or property because it gets sold at auction.

The percentage interest is the ownership interest you may acquire if the tax sale is not redeemed or annulled. If you bid 1%, you are bidding to own 1% of the property if the tax sale is not redeemed. The tax debtor will still own the other 99%. It is possible that a 1% ownership interest will be worth less the tax sale price.

If the property doesn't sell at the tax sale, then it can get forfeited to the local municipality. Not every property gets a bid at a tax sale. When a property gets adjudicated to the local municipality they get a type of tax deed to the property.

The original owner of the property still owns and has possession of the property after a tax sale. The original owner should be safe from eviction after a tax sale. The owner who does not pay by the deadline to undo the tax sale can lose full ownership of the property.

Tax sale title is fully transferable and heritable, meaning the title can transfer from one person to another. For example, after a death, you may inherit a tax sale title. The purchaser who transfers their tax title to another is subject to the existing right to redeem the property.

When the redemptive period ends, then the purchaser can get full ownership.  The purchaser can file a lawsuit to quiet the title. This provides the purchaser with a clear title and full ownership of the property. During this process, the purchaser sues the former owners. The owners can defend the lawsuit by attempting to annul the tax sale. If the owners are unsuccessful, the property may belong to the purchaser. 

You will need an insurable title to sell or renovate the property. Quieting title requires formally notifying all parties whose interests you want to terminate, such as owners, mortgagees, and other lienholders. After the sending of post-sale notice or service of quiet title action, interested persons have six months to file a nullity action (60 days if the tax sale is more than five years old). If they don’t file a nullity action on time, you are entitled to a judgment quieting title to your percentage interest. If you have less than 100% interest, you may need to file a partition action. In a partition action, one co-owner may buy out the other co-owners interests. If no agreement can be reached, the court will set a price or sell the property at a sheriff’s sale. The proceeds are divided according to each co-owners percentage interest.

An owner can bring an action to annul a tax sale when they do not redeem the property in the redemption period. The action must get filed in the parish where the property is. The action may get filed as a reconventional demand or an intervention in an action to quiet title. The most common grounds for annulment are failure to give notice, a “redemption nullity”, redemption, or payment. If an action to annul is successful, the tax debtor may still pay the redemption amount to reclaim the property, unless the ground for nullity is that the taxes were paid and current at the time of the tax sale.

If you have a mortgage on your home, the loan servicer might collect money from you as part of the monthly mortgage payment to later pay property taxes. The servicer pays the taxes on the homeowner’s behalf through an escrow account. If taxes aren’t collected and paid through this kind of account, the homeowner must pay them directly. 

Failure to pay taxes is usually not allowed under a mortgage contract. This may result in the mortgage company filing a foreclosure. The terms of most mortgage contracts require the borrower to stay current on their property taxes. If you don’t pay property taxes then you’ll be in default under the terms of your mortgage. A loan servicer can foreclose on the home in the same manner as if you had fallen behind in monthly mortgage payments. 

If you cannot afford to redeem the taxes, you may want to try contacting your mortgage lender to see if they will redeem the taxes and add the balance to your existing mortgage. You may also consider taking out a home equity line of credit (HELOC) or reverse mortgage to pay the taxes. 

Property tax liens almost always have priority over other liens, including mortgage liens and deed of trust liens. This means that the parish will get paid before any other people or banks who have a claim to the home. Because a property tax lien has priority, if you lose your home through a tax sale process, mortgages get wiped out. So, the loan servicer will usually advance money to pay delinquent property taxes to prevent this from happening. The servicer will then demand reimbursement from you (the borrower). If you have a mortgage and fall behind on property taxes, the mortgage company will step in to pay the taxes to the tax collector. The mortgage company will protect its interest in the property.