What to Do if Your Property is Sold at a Tax Sale

John Edward Reid

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Real Estate Attorney

Contributor Level 7

Posted almost 5 years ago. Applies to Maryland, 2 helpful votes

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1

Obtain a current property tax bill

The first thing to do, if you don't already have one, is to request a current tax bill from your taxing authority. In the counties in the State of Maryland, this will usually be the County Treasurer, Department of Finance, etc. In the District of Columbia, there is only one place - the Office of Tax & Revenue. It is best to get this document in person and leave with an officially prepared bill.

2

Review the chain of title to the property

This is best done with the assistance of an attorney who knows real estate law. If your title to the property is imperfect, you may not have standing to redeem the property or to defend your interests in court. For instance, if your Aunt Margaret left you her house in her will back in the 1980's but you never recorded a deed, you'll need to clear this up - not only to deal with this tax sale, but to protect your rights to the property in many other areas as well.

3

Pay the taxes if you are able

If you have the money, it is best to pay the real property taxes immediately and save any excessive interest, penalties and/or fees that can rapidly accrue. You can always dispute the validity or amount of the delinquent tax later, and it will be credited to your account if you prevail. In Maryland, you won't be able to pay the taxes unless you've first paid the tax sale purchaser's attorney's fees and expenses and obtained a "release." In DC, you can pay anytime at a Wachovia Bank located within DC with an official tax bill.

4

Keep your documents

Make sure to keep all tax bills, cancelled checks used to pay taxes, tape receipts from the bank, etc. You may need these documents later to prove payment if there is a discrepancy, or in a court if the purchaser files a complaint to foreclose the right of redemption.

5

Hire a competent attorney

If you find yourself involved in a lawsuit to foreclose the right of redemption, or know you don't have the funds necessary to redeem the property from the tax sale, consult with an attorney who is familiar with the process to discuss your options. Your attorney may be able help you refinance your property or seek other assistance to redeem the property, or defend your interests in court, and get this matter behind you and minimize your exposure to risk and escalating costs.

6

Redeem the property from the tax sale

This usually involves: 1) payment of the purchaser's attorney's fees and expenses; and 2) paying all the taxes and other municipal bills due to the county or city in which the property is located. If there is a lawsuit involved, make sure it is completely dismissed with prejudice and the any lis pendens has been released on the land records. In DC, obtain a Certificate of Redemption from OTR for $100 and record the document. It's worth it.

7

Make sure this never happens again

After you have completed redemption of the property, the certificate is satisfied and the lawsuit, if any, is dismissed in its entirety, take steps to ensure this never happens again. Make sure the taxing authority has a current and accurate address to send the tax bills, make sure the mortgage company is escrowing the taxes with your monthly payments and makes the payments when they are due, make sure your brother who is living in your parents' home is paying this bills, etc. Whatever your specific situation, make sure the taxes are paid in full on an annual basis. If you don't get a tax bill, go get one from the taxing authority and pay it.

Additional Resources

DC Tax Sale Redemption Process by OTR

Baltimore City Department of Finance

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