Getting Delinquent Taxes Paid
Hi everyone. I'm just getting started with land investing and could really use some advice on dealing with tax delinquent properties. Specifically, the county I'm working in requires that delinquent taxes be paid by the person who was the owner WHEN the taxes became delinquent. So it seems that I can't buy the parcel and then pay the taxes. I can think of two possible ways to address this: I could ask the owner to sign a purchase agreement that includes a contingency that they must pay the taxes first and then they'll receive the purchase price plus the taxes they paid. Or I could set it up so they sign the agreement, then I send the seller the tax money and pay them for the property after the taxes have been remitted. This can be a win-win, but I don't want to get burned. Maybe I should have a third party involved? Anyone have some thoughts on this? Thanks in advance!
Honestly, I have never heard of that. What County and State?
Here are some possible ideas to consider:
- Google search [county name, ST] + "pay real estate taxes on line" to se if they have an on line pay portal that you could possibly use to pay by credit card. If so, I suspect the CC processor won't care who pay its.
- Pay the taxes with a cashiers check or money order made out and mailed to the county tax office with the previous owner's name and property APN in the memo.
- At time of closing have the previous owner sign a limited power of attorney granting yo the power to pay property taxes for them for the period in question.
Karl James Thanks for your input, Karl. I should clarify the situation a bit. The county does allow online tax payments in most situations. However, the property I'm looking at has already gone into foreclosure, and is nearing the end of the two year redemption period. In this case, according to the assessor's website, "During the redemption period, payments may only be accepted from parties with a recorded interest in the property at the date of the judgment. Payment by Certified funds (cash or cashier's check) is required..." and online payment is not accepted at this point. This complicates things, but also presents a nice opportunity. The seller is literally about to lose their property completely, and have nothing to show for it (except a negative recording on their credit report). I'm happy to pay the delinquent taxes, and put some money in the seller's pocket, but I'm trying to figure out how to do this in a way that ensures the taxes do get paid (since the seller has to make the payment) and ownership is transferred. I'd like to be sure that when I send the money to pay the delinquent taxes, the seller doesn't just put the money in their pocket and break contact. The money I'm offering for the property is quite a bit more than the delinquent tax amount, but that's doesn't guarantee that they'll do the sensible and honorable thing.
By the way, Karl, I just wanted to say that I've read several of your posts and watched an interview you did with Seth Williams, and I'd like to thank you for all the great information you've shared!
Ah, I get it now - makes sense.
Are you in the area of the property? If it is a really good deal, perhaps you could meet the seller at the tax office (and meet a mobile notary there also) and have the seller sign the deed and you pay the taxes all about the same time.
Arturo Arturo last edited by Arturo
Shaun Becker hi there, if you're new, what would you say to contact a title company in the area (so there are more possibilities they could be familiar with this situation) and ask if they can manage it and, if they can, just make them close?
Also, I believe that there should be some form of legal paper (signed by a notary or an attorney) that makes official whatever agreement you take with the seller, so they cannot run away with your money.
I'm new too and I would probably check with the local Title Company first.
Shaun Becker Not sure if this would work but is there a way to instruct the closing attorney to take the money at the time of sale and pay for the Delinquent Tax bill? This way the seller gets the money you are paying them but the portion that is located to taxes gets withheld by the closing attorney and sent to the county? Karls money order Idea sounds really good and simple!