Expert: Dick Dennis - 12/3/2008

Question
Hi Dick,

A man told me yesterday that one can go to a courthouse & purchase property which has unpaid property taxes attatched, by paying the taxes. If so, does one just pay the taxes & become the new owner of the property? Is it really that simple?

Again, if this is true, are there also any downsides to buying property through this process?

Thank you very much.

Best,

MikeE.

Answer
No, Mike, it's not that simple. I suppose there might be certain states in which the process of buying property because of delinquent taxes is very easy, but not likely. Each state is completely different from its neighbor. What you need to do is to go to the county tax collector and pose that same question you just asked me.

They will tell you. But be aware that in this kind of real estate market, Mike, (or for that matter, any kind of market) you're not going to find too many decent properties to buy that way. Keep in mind that any property that is subject to a mortgage and the owner failed to pay the taxes is going to have the taxes paid by the mortgagee who then would put the property into foreclosure. And you know the story from there.

Also be aware that if you are able to buy property because of delinquent taxes, it is more likely going to be out in the boonies, no matter in what state the property is located. I will bet right now that you can go to your tax collector and ask for a list of properties that may be for sale. If there are any, it'll be properties like I just described. Otherwise, they usually have a date or two each year on which they sell properties that have not had their taxes paid. Or there might be the possibility that the property is something that will require you to spend a lot of money to fix it up if you expect to resell it or live in it.

There are some pretty books on the subject of buying properties at tax sales, Mike. Pick up one or two and become very informed. I do wish you well.

Dick Dennis         dixiedee13@aol.com