Letting property go to tax sale - Affect my credit reports?

6 Replies

Pretty basic question for the seasoned vets:

I have a property in PA in my own, personal name that I’m looking to let go to tax sale. Will this affect my credit reports in any way?

Real estate taxes are typically not personal debts... they are liens against real property that follow the property, not the owner. Your credit should be just fine.

Originally posted by @Tom Gimer :

Real estate taxes are typically not personal debts... they are liens against real property that follow the property, not the owner. Your credit should be just fine.

 Thanks, Tom. Does it depend on the particular Township/municipality, or is it just standard practice that they don’t report? I thought maybe it would show up as some sort of judgment. I’m probably being paranoid, but I’d hate to screw up my credit.

Your question inspired me to research this. Real property taxes are always liens against the real estate they are associated with but the question becomes when do they become something that can affect an owner's credit report?

It seems that while the locals won't currently report such things to credit bureaus, a tax sale including the owner's personal information would be public record that could potentially be obtained by credit bureaus. Not reported to but potentially discovered by -- that seems like a lot to expect from the bureaus, but my earlier, comforting answer needs that update.

I’m interested in this, as well. I’m hoping someone with firsthand knowledge can chime in.

Originally posted by @Ken Sanders :

I’m interested in this, as well. I’m hoping someone with firsthand knowledge can chime in.

You're not going to get a definite answer. As I said, the counties currently do not report to the bureaus. However, since this is public information it could find its way into a credit decision.

@Tom Gimer

Aside from credit score, wouldn't this still show up on someone's record somehow? Then it could be used for a financing decision? 

If you plan on continuing to buy property I could see this hurting you somehow, even if it doesn't hit your credit score. 

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